Businesses cautious but positive about hiring more staff, survey finds

Photo / Martin Sykes

New Zealand businesses remain positive about hiring staff but are seeking a higher percentage of contract workers, recruitment company Hudson says.

Hiring intentions increased for the fifth quarter in a row, but is up only marginally on figures from the first half of this year.

The overall results of the Hudson Report show a net 20.3 per cent of businesses indicating an intention to increase their permanent staff numbers during the current quarter, up 0.5 percentage points from the previous three months.

"The consistently positive hiring intentions of the last three surveys indicate that the market has reached a new equilibrium, after the turmoil of 2009," said Marc Burrage, Hudson NZ's general manager. "Although this positive sentiment does not match the levels enjoyed during the boom, it suggests that businesses are feeling more certain about the future."

Strong employer intentions to increase the size of their contracting/temporary workforce - from 6.9 per cent to a net 13.2 per cent - showed businesses were cautious about investment and looking for solutions that allow them to scale up and, if necessary, down again quickly.

Up until this report, the recovery from the recent recession had thrown up different trends, with intentions to increase permanent employees improving ahead of intentions to employ contractors.

This suggested that the back-filling of critical permanent roles that had not been filled during the downturn was taking precedence, said Burrage.

"The latest results should provide confidence to the increasing number of skilled professionals that have made the decision to be career contractors in recent years."

The majority of industries surveyed for the July-September 2010 quarter have recorded an increase in sentiment over the past quarter, but there are some exceptions leading to the steady overall result.

The IT sector leads the positive sentiment with 55.7 per cent of employers indicating plans to raise their permanent staff numbers during the coming three months - a 29.2 percentage point increase.

"The sharp sentiment improvement in the IT industry is one of the clearest indicators that businesses are ramping up many of the projects that were put on hold recently, signing off the large-scale capital expenditure required for IT projects and back-filling vacant roles."

Other sectors to enjoy significant increases are private healthcare and FMCG, up 21.5 percentage points and 16.8 percentage points respectively. Confidence in the financial services/insurance sector is also of note, with a fifth consecutive quarter of improvement and construction/engineering/property has continued to improve after a significant jump in the second quarter of 2010. More than 1100 businesses were interviewed for the report.