Australasian employers are changing they way they recruit

Labour market demand and supply factors are combining with significant advances in technology to irrevocably alter the way employers recruit. The technological advances have been facilitated by the widespread adoption of the internet, which has not only enabled the emergence of a new industry, the e-Recruitment industry, but a paradigm shift in the recruitment function.

The Australasian e-Recruiting Trends 2002-2004 report is a comprehensive review of the utilisation of e-Recruitment within Australasia over the past 3 years. It analyses the utilisation and rate of adoption of three core components (the careers website; advertising jobs on the internet (e-Sourcing); and e-Recruitment systems) and adherence to generally accepted best practice principles by 500 of Australasiaís largest employers (the Australasian 500). The key findings were:

The careers website
74% of the Australasian 500 now have a careers website, up from 49% in 2002. This trend is similar to the experience of the Global 500 3 years ago .

The careers website is also becoming more sophisticated. In the past 2 years, 27% of the Australasian 500 have developed their careers website by adding more sophisticated functionality and content. However, the level of sophistication is between 2-4 years behind other developed parts of the world.

e-Sourcing
58% of the Australasian 500 now list jobs on their website, up from 10% in 2001, and the number of jobs posted on the careers sites has increased 50% from an average of 12 in 2002 to an average of 18 in 2004, indicating that those employers listing jobs are using this source of candidates more extensively.

On a global scale, this practice is more than 4 years behind the Fortune 500, 3 years behind the Euro 500, and around 2 years behind the Canadian 100 .

A similar pattern is emerging in the use of the commercial job boards (Seek, Mycareer and Careerone). Today 52% of the Australian 500 use them, up significantly from 30% in 2002, but only 5% up from last year. However, the number of jobs posted by these employers increased by 57%, representing 263% growth over 2 years. This substantial change indicates the increasing importance of the commercial job board as an effective channelling strategy and sourcing point for candidates.

Both trends illustrate the shift towards direct advertising by employers. Armed with more sophisticated websites and e-Recruitment systems, they are able to handle more of their recruitment directly, shifting away from the use of recruitment agencies. However, whilst the Australasian 500 employ around 25% of the workforce, the proportion of jobs posted directly by them represents less than 3% of the total roles on these sites, indicating this trend is still in the early stages of development.

e-Recruitment systems
34% of the Australasian 500 utilise some form of e-Recruitment system, representing a 62% increase over the past 2 years.

Nearly 20% of employers with an e-Recruitment system in 2003 were no longer using a system in 2004, and a further 35% changed vendor in the last 12 months. This trend is not surprising as there are a large number of vendors in the market (including in-house developed systems), and less than half provide the functionality required to deliver globally competitive recruitment capability.

The adoption of e-Recruitment systems correlate with the degree of adoption achieved in Europe and Canada before 2001 and in North America before 2000. Global market forces will compel the Australasian 500 to follow suit, or risk suffering a competitive disadvantage in the increasingly global and competitive war for talent.
Amongst the Australasian 500, the more sophisticated e-Recruitment systems are delivered by third party software vendors (generally specialists in this area).

Given this regionís early stages of adoption, it is not surprising that it is a fiercely competitive field. Over the past two years the market has seen the number of vendors with clients in the Australasian 500 almost double from 13 to 24. Whilst the market is showing signs of expanding, it is also showing the first signs of consolidation.

During this time 5 vendors lost all clients and presumably are no longer viable or have withdrawn from the region. At the same time only 9 vendors have multiple clients and 4 share the market leading position with around 15% each.

e-Recruitment Best Practices
The adherence to 12 generally accepted e-Recruitment best practices is very poor amongst the Australasian 500, where only 4 demonstrated all best practices. Generally, larger employers recorded a higher rate of adoption, most likely due to a more comprehensive planning process and the use of more sophisticated e-Recruitment systems.

Conclusion
In accordance with this worldwide trend, the Australasian 500 are adopting e-Recruitment. Typically starting with a simple careers site, over time they are adopting more sophisticated practices, and increasingly sophisticated systems to enable these practices. They are also managing more of their recruitment processes directly, indicating that the adoption of these practices and systems is enabling employers to reduce their reliance on 3rd parties (such as recruitment agencies) to source, process and manage a relationship with their candidates.

Whilst the trends of this progression are clear, the following are of particular concern for the Australasian economies:

- the rate of adoption of these practices and systems is between 2 to 5 years behind other developed regions of the world, who as a result have a competitive advantage in the global war for talent;

- whilst technological integration continues, the speed of adoption has almost halved from previous years; and

- best practices are emerging, but very few organisations have been able to adopt them all effectively.

Readers can download a free 16 page summary of the report at www.pinpointhrm.com.au.