2024 has seen similar trends from last year, but with signs the market is starting to improve. Over the last 18 months we have seen a big reset of the technology boom we experienced in 2020-2022. Macro-economic conditions combined with over-hiring strategies caused all industry sectors to hit either the pause or rewind button in 2023. Only business critical projects went ahead and removing costs (people) has been the business priority. However, it is hard not to see the recent high-profile outages and tech platform issues in the media as the signs of the pain this is causing. Cost cutting on technology in the digital age is not a long-term strategy.

The latter part of 2023/early 2024 was the toughest market we have seen since the GFC. Permanent hiring was particularly badly hit with some salaries going backwards by as much as 20%. We saw ongoing redundancies across the period and a move towards “profitable growth” at the board level vs the “growth at all costs” narrative we have been used to seeing in the tech sector up until very recently. 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.

The delayed 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, but we are not expecting a significant improvement until early 2025.With more candidates 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.

Surprisingly, the Public Sector has seen around a 15% reduction in headcount over the last year. Government is a sector that is normally very consistent, regardless of what the rest of the market is doing, so this has impacted the broader market.

The NSW Government continues to look to make savings through contingent workforce cuts. Projects are being reviewed and put on hold and contract extensions bring an air of uncertainty. The normal “safe havens” of Health and Education are not immune. Some Government agencies have looked to make savings by implementing a max two-year tenure rule, although this isn’t working too well as they struggle to backfill the IP with permanent employees or fixed term engagements. Contractor rates have started to soften from COVID highs as an increase in the supply of contractors on the market puts downward 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.