Businesses spending more on recruitment amid talent war

New data has revealed that companies have spent significantly more money on recruitment this year in response to talent shortages crippling the workforce.

Business expense payments have increased by 9 per cent in 2023, an increase of $12.7 billion. Total expenses for Australian businesses for January to May 2023 exceed $152.8 billion.

Recruitment is taking a big chunk of this, with Aussie organisations spending $429 million more on recruiters than last year.

“Our expenses data shows recruiters are emerging as the winners of the talent crisis. Increased spend on employment agencies suggests SMEs are struggling to find talent in the ongoing skills crisis, forcing them to turn to third parties to resource their teams,” said Airwallex director of sales Lachlan Millist.

“This brings a new cost into consideration for businesses at a time when money is already tight. Businesses need to find cost savings elsewhere, so they have access to the talent they need to grow.”

As revealed by Mr Millist, recruiters are reaping the benefits of the current talent situation. In fact, Airwallex highlighted that businesses, on average, are spending an extra 16 per cent on employment agencies, equalling around $10,000.

Mr Millist continued: “Too many businesses are paying through the nose for everyday essentials, including on exchange rates and transactions. They may seem insignificant numbers in isolation, but over the course of a few months or a year, it all adds up.”

“Just a few years ago, businesses were spoilt for choice when it came to recruitment, but now, they’re having to be smarter about costs in other parts of their operations to source the talent they need to grow.

“This is a really tough macro environment for a lot of companies, so being able to track and account for every dollar being spent is important.”

While this news spells trouble for organisations, recruiters are clearly having a great time picking up the pieces of the talent war.

This supports the claim made by Elizabeth Kingston, who claimed the role of the recruitment agency would indeed be around for the long haul, even as others disagreed.

“Is the recruitment agency here for the long haul? You bet. As technology advances, we’ll keep finding efficiencies and improving client and candidate experiences. We are here for the long haul, and we’re excited to deliver more quality and value,” explained Ms Kingston.