Finding workers is no longer the top concern for leaders at middle-tier firms as the ultra-competitive jobs market in Australia starts to come off its peak.
Battling for talent remains the second most pressing concern for mid-market business leaders as per new survey results, with costs and margin pressures now the number one worry.
The findings in the survey by consulting firm KPMG mirror easing job vacancies and other signs of a weakening jobs market, although official employment data suggests there’s plenty of heat left in the labour market yet.
The weakening jobs market is likely feeding into lower expectations for wage growth among business leaders.
Last year, 44 percent of leaders were bracing for wage growth as high as eight percent compared to 30 percent of respondents this year.
More than half expect wages to grow by less than four percent.
The pulse check also revealed cautious optimism for growth across middle market businesses, with 55 percent of leaders expecting strong growth over the next three years.
But compared to this time last year, a larger cohort were either neutral or pessimistic about growth projections, up to 45 percent from 34 percent last year.
KPMG enterprise tax leader Clive Bird said confidence had taken a hit.
“It is encouraging that the majority of mid-tier businesses, the heartbeat of the national economy, are still predicting growth over the next three years, but it is clear that confidence is down on last year,” he said.
He said the mid-tier business community was resilient, with 75 percent of respondents reporting manageable debt levels and less than a quarter under serious pressure from higher interest rates.
The survey also asked business leaders what they wanted to see in the May budget to stimulate economic growth.
Re-establishing critical manufacturing in Australia was the top response, followed by tax reform, more money for skills and training, and a commitment to keeping the stage three tax cuts.
“While there is still no desire among the mid-tier sector for heavier taxes to fix the country’s debt problems, there is an eagerness for tax reform to generate economic activity,” Bird said.
“Retaining the stage three tax cuts was popular among respondents, which would make some contribution to the rising cost of living.”
