7 in 10 businesses to implement cost-cutting measures
Australian businesses are considering technology-driven cost-cutting strategies as well as salary reductions and layoffs, recent data from Deel has revealed.
New research from HR platform Deel has revealed that 70 per cent of Australian businesses will implement cost-cutting measures due to market uncertainty this year.
Deel's Australian Business Leader Pulse Check indicated that technology-driven cost-cutting strategies were a key priority for Australian organisations.
The research found that 60 per cent of organisations are considering leveraging new technologies like artificial intelligence (AI) to automate business processes, while 59 per cent plan to consolidate their technology stack and reduce tech vendors.
The survey also found that 45 per cent of organisations plan to reduce salaries, while 41 per cent are considering layoffs.
With more organisations turning to AI to support belt-tightening, the research also found that 93 per cent of businesses are anticipating an increased need for AI expertise. This is especially the case in the areas of HR, finance, accounting and customer service.
However, the hunt for AI talent is hindered by a local skills gap, with 57 per cent of business leaders citing it as one of the top challenges.
Over half of enterprises also admitted to difficulty evaluating candidates’ AI skills and their high salary expectations, both of which are significant hiring hurdles.
To overcome these obstacles, nearly one in two Australian business leaders (49 per cent) are expanding their talent search to include domestic and international markets.
Deel data also indicated that two-thirds (67 per cent) of Australian organisations already have team members overseas.
Companies cite access to a wider talent pool, opportunities for skills transfer with local employees, the ability to expand to new markets and cheaper salaries as key benefits of this model.
Deel ANZ country leader Shannon Karaka said global hiring offers companies the opportunity to access specialised skills that may be still emerging locally.
"The approach is increasing in popularity owing to its ability for the model to help bridge skills gaps, ensuring that Australia can remain competitive on a global scale,” Karaka said.
“With 89 per cent of Australian organisations stating they’re open to hiring talent outside of the country, organisations are primed to take advantage of the benefits offered by a globalised market to ensure talent and skills funnels are prioritised, promoted and invested in for the future, both domestically and internationally.”
Deel's research also revealed that Australian firms are also facing other challenges concerning hiring and retaining new employees.
Staying up to date with benefits and trends was listed as the most challenging factor for local firms, followed by the pace of technology and managing workplace culture, according to Deel.
Integrating younger generations into the workforce is also a major obstacle to hiring and retaining new employees for nearly one in five companies.
The research also indicated that payroll departments, particularly those managing global teams, are grappling with increasing complexities, with one-third of Australian businesses handling payroll for over five markets.
The report found that navigating a patchwork of tax, labour, and regulatory requirements, ensuring accurate and timely cross-border payroll, and managing complex benefits and allowances were all major pain points for payroll departments.
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