The first half of 2025 has been mixed with some industries showing signs of recovery but others still facing challenges. Recruitment activity is on the rise in certain sectors, but the growth outlook has stagnated. The combination of Federal elections and geopolitical uncertainty created elsewhere have tempered our expectations on what will happen for the remainder of 2025

We are still seeing large volumes of applications across Project Services, Support, and Corporate Services. It is not unusual for us to still receive 750-1500 applications per role. Responding to this volume of applications is hard for agencies and employers and so the levels of candidate service is suffering, leading to a lot of frustration in market. Recruitment agencies and internal recruitment teams continue to operate very lean with a laser focus on productivity. At Talent we have maintained our full teams, as we take a long-term view and are prepared for when the market turns.

Permanent hiring remains stagnant with some salaries on some roles returning to levels not seen since 2019. We continue to see redundancies and a move towards “profitable growth”. We experienced the cooling of salaries across many job families, although hard to find niche talent will always test the top end of what the market has to offer. We have yet to see the true impact of AI. Companies hiring for Software Engineering and Data roles are now expected to have experience in or an understanding of Generative AI, LLM’s or Machine Learning.

Despite all this, there are some green shoots as the macroeconomic outlook shows moderate growth. Economic growth surpassed market expectations with GDP growing in the final quarter of the financial year. The RBA has again cut the cash rate, and further cuts are projected. Inflation is predicted to be 2.9% by the end of 2025, which sets us up for a brighter start to FY26.

Business critical projects can only be postponed for so long, so the need to invest in technology & transformation combined with some positive signs the economy is finally improving, suggest that investment and hiring is starting to recover. With a high volume of candidates still competing for jobs, the advice to candidates is to be flexible and think holistically around what matters most when considering an opportunity. Companies are becoming fussier with an expectation of an 80%-90% match to the job profile, whereas throughout the COVID period, candidates with a 60%-70% match were being hired. Advice for clients would be that the best candidates are still hard to attract. There is a reservation to jump ship in a market as unpredictable as ours, so when you find a great candidate make your offer competitive and move fast to secure them.

The NSW Government continues to look to make savings through contingent workforce cuts. This does seem to be slowing down with some departments (especially in IT), at breaking point so hopefully will bottom out over the next 3-6 months. In Labors first term, inflation was been the dominant challenge so the government's room to maneuver on policy was been constrained. With the recent more positive inflation figures the risks that will be most front of mind will be different: namely now the risk of a slowing economy and the need to maintain stability and confidence, particularly given what else is happening in the world should come to the forefront of Labors actions. Hopefully now they can look to releasing some funds for projects which will have the need and appetite for the expertise of the white-collar contingent labor market.

While the re-elected Labor government has promised contingent workers better access to benefits this has yet to eventuate and the significant decrease of contingent opportunities in the tech and white collar continues to put pressure on rates.

When it comes to technology sales roles, we have also seen the market revert to pre-COVID levels in terms of hiring for many go-to-market roles i.e., sales, sales leadership, and for some roles we have seen demand drop well below pre-COVID levels, i.e., customer success, channel/partner and pre-sales.