The latest executive demand index from recruitment firm EL Consult reveals a flat result (no movement up or down) for ICT in August — the second best result for the month of all business sectors — with demand relatively broad, coming from all regions including Victoria, Western Australia and the ACT. And even in the financial sector, executive demand in August was up by just 2% over the previous month.
“Although it has been volatile recently, the (ICT) index has been rising since 2016 and reflects both the need to cut costs and power marketing and sales efforts,” EL notes.
Across the board, in all business and industry sectors, EL reveals that although executive demand fell 4% in August, it is now at its highest level since 2011 in trend terms as economic activity continues to rise.
“As was predicted by the EL Index 18 months ago, it is now clear that the economy is strongly pushing ahead", he said.
"At the time, we reported that the EL Index results then represented the most positive start to a year we had seen in at least four years.
"It hasn’t stopped. The reason is that businesses expand their management team when they a confident in the future and expanding. It is a big investment and they are the first to go if there is any sign of a downturn.
“And right now, businesses are continuing to expend their management hire, albeit with some small month-to-month volatility.
“And with record growth in the economy, we seem to be throwing off any concerns about the US trade wars with China.
“Gosh, with growth like this, Australia may one day be as big as Apple and Google combined,” Montgomery said.
He said says businesses were continuing to hire executives, although there would be some volatility month-to-month.
“Trade talks are continuing and, in fact, an increase in tariffs between China and the US may be a good thing for Australia as it makes the relative terms of trade between China and Australia better.
“However, China may be affected in such a way that they decrease the amount of exports they raise. This could affect Australia over the medium term.”
According to Montgomery, Australian employers seem to be “too busy to be worrying about political ructions”.
“The political situation may have been explosive, but the world keeps on turning. It’s OK, despite trade wars and political circuses.
“Canberra has been called ‘toy town’ and sometimes it’s difficult to believe that they understand what is going on in the big cities of Australia.”
“GDP forecasts continue to be strong, despite the drought affecting farm-based revenue.”
Montgomery said the private sector was providing the impetus for the overall demand increase.
“The private sector continues to provide the lion’s share of positions," he said.
Among the sectors, the Management index is being affected by a change in dynamics.
“We are seeing a great deal more ‘manager’ positions being advertised, because they’re bumping up titles to ‘manager’ level and decreasing the rigid qualifications that may be required in other sectors such as Finance or Engineering.
“There are more service industries that need managers, rather than direct doers. In August, the smaller states put in positive results, but the overall index was pulled lower by the larger regions. The ACT led the way, prompted by gains in the Engineering, Financial and Information Technology sectors. Overall, in the month, the financial sector led the way to be the only region to finish in the black.”