5 growth industries in Australia to watch in 2023
Australia is not only known for its breathtaking landscapes and unique wildlife but also for its thriving economy and commitment to innovation. As we step into a new era, the country is experiencing significant growth in several key sectors that are poised to shape its future trajectory. In this blog, we will delve into four major growth sectors in Australia: cybersecurity, tourism, renewable energy, and healthcare. Healthcare sector The healthcare sector continues to thrive as one of the most rapidly expanding industries globally, benefiting greatly from the impact of our ageing population. Projections indicate that by 2041, the number of individuals aged 65 and above in Australia will reach a significant figure of 6.66 million. While there have been discussions surrounding the apparent stabilisation of the ageing population, it is essential to consider the broader context of overall population growth. Despite potential levelling off in percentage terms, the actual number of older individuals in need of healthcare continues to rise steadily. This trend underscores the persistent increase in demand for healthcare services among the elderly population. Renewable energy At present, the renewables industry in Australia employs 28,000 individuals. However, this number is expected to surge to 45,000 by 2025, establishing it as one of the fastest-growing industries in 2023. With the imminent arrival of the global Net Zero 2030 goals, the world is swiftly embracing renewable energy sources as awareness of sustainability and environmental impact grows among consumers. Projections indicate that by 2024, renewables will account for nearly 33% of the world’s electricity production. In a significant milestone, the National Electricity Market reported that renewables already contribute to 50% of Australia’s primary electricity grid as of 2022. Rooftop solar takes the lead with an impressive 24% share, followed by wind power at 16%, large-scale solar at 9%, and hydroelectricity at 2%. Australia’s wind farm industry has experienced remarkable growth, expanding almost five-fold over the past ten years until 2021-22. It is poised for rapid expansion in the coming five years, with projected revenue growth of 52.6% in 2023/2024. Tourism Following three years of intermittent lockdowns, the travel industry is rebounding in 2023, experiencing a resurgence that surpasses previous levels of activity. A YouGov survey conducted for the World Travel & Tourism Council reveals that international travel is expected to surpass pre-pandemic figures this year, indicating a strong desire for people to explore and venture out once again. The positive news extends to the domestic front as well. In 2020, international tourist arrivals witnessed a staggering decline of 73%. However, the year ending September 2022 saw a rebound with 2.2 million arrivals, marking a remarkable 1184% increase compared to the same period in 2021. With the lifting of travel restrictions, the travel and tourism industry is experiencing a renaissance. According to IBISWorld, the top three fastest-growing industries in Australia all fall within the travel sector. Leading the pack is travel insurance, projected to witness revenue growth of 206.0% in the 2023-24 period. Following are foreign currency exchange, with a growth projection of 128.5%, and inbound tour operators, with an expected growth rate of 87.1%. The overall revenue forecast for the travel and tourism market in 2023 is projected to reach AU $20.08 billion, reflecting the robust recovery in the industry. Hotels are also regaining popularity despite the competition from Airbnb. Expedia reports that 60% of Australians are planning a hotel stay in 2023. Additionally, the desire for luxurious 5-star accommodations is on the rise, with the luxury segment expecting a remarkable 42.7% revenue growth for the 2023-24 period. Cybersecurity The cybersecurity industry in Australia has been experiencing significant demand for skilled professionals. The Australian Cyber Security Growth Network (AustCyber) estimated that by 2026, the cybersecurity sector in Australia will need an additional 18,000 skilled workers. The field of cybersecurity plays a crucial role in safeguarding every industry. In an era where businesses own websites and conduct online operations, the services of ethical hackers, known as white hat hackers, are in high demand. Their expertise helps companies protect their customers and maintain the integrity of their brand. When a business falls victim to a cyberattack and experiences data breaches, the stolen information quickly becomes public knowledge, posing a significant risk to the affected brands. In some cases, these incidents can lead to brand reputation damage and even business failure. As a result, the need for cybersecurity professionals is already substantial and is expected to grow further as more retailers and government departments rely on the internet for their operations. Is 2023 a good time to expand your business into Australia? Expanding a business into new markets requires careful consideration of various factors, including economic conditions, market trends, and growth prospects. Australia, with its stable economy, favourable business environment, and numerous growth opportunities, presents an ideal landscape for businesses looking to expand. Strong Economic Growth: Australia has a resilient economy that has shown consistent growth in recent years. According to the Reserve Bank of Australia, the country’s GDP is projected to grow by 4.5% in 2023, highlighting the robust economic outlook. This steady growth indicates a favourable business environment with increased consumer spending and business investments. Business-Friendly Environment: Australia is known for its favourable business environment and ease of doing business. In the World Bank’s Ease of Doing Business Index, Australia ranks 14th out of 190 economies. The country’s transparent legal framework, strong intellectual property protection, and efficient business registration processes create a supportive ecosystem for businesses to establish and expand their operations. Skilled Workforce: Australia boasts a highly skilled workforce, ensuring access to talent across various industries. The country has a strong education system and a high percentage of tertiary-educated individuals. As per the Organisation for Economic Co-operation and Development (OECD), around 46% of Australians aged 25 to 64 hold a tertiary qualification. This educated workforce offers businesses the opportunity to recruit top talent and drive innovation. Are you ready to expand your business into Australia? ANZPEO enables you to hire skilled workers quickly and compliantly. Speak to us today about
What is an Employer of Record, and how will it let me hire workers in Australia?
In today’s global economy, businesses often need to expand their operations into new markets and hire talent from all over the world. However, the complexities of local employment laws, tax requirements, and compliance regulations can be daunting for companies looking to establish a presence in a new country. This is where an Employer of Record (EOR) can be a valuable partner. What is an Employer of Record (EOR)? An Employer of Record is a third-party service provider that assumes legal responsibility for employment-related activities on behalf of a company. Essentially, the EOR becomes the official Employer of Record for the company’s workers and takes on responsibilities such as payroll processing, tax withholding, benefits administration, and regulatory compliance. What are the main differences between an EOR vs PEO? Employer of Record (EOR) companies offer a range of services that are similar to those provided by Professional Employer Organisations (PEOs), including payroll processing, benefits administration, and employment management. However, the key difference between EORs and PEOs is that EORs do not establish a co-employment relationship with the employees. Instead, the EOR becomes the legal employer of the workers, with a single employment agreement that is managed by the EOR. The EOR then enters into a services agreement with the client company. How does an EOR work in Australia? For international businesses looking to hire quickly in Australia without establishing a legal entity, partnering with an Australian Employer of Record can be an ideal solution. The EOR assumes full legal responsibility as the Employer of Record for the company’s workers in Australia, allowing the company to hire and manage its employees in compliance with local laws and regulations. By partnering with an Australian EOR, businesses can focus on their core operations and growth strategies while leaving the complexities of employment compliance to the EOR. The EOR takes care of everything from payroll processing and tax withholding to employee benefits and regulatory compliance, allowing the company to save time and money on administrative tasks and focus on what matters most. Benefits of partnering with an Australian EOR Partnering with an Australian EOR can offer several benefits, including: Compliance with local laws and regulations: The Australian EOR has detailed knowledge of local employment laws and regulations, ensuring that the company is compliant with all applicable laws and regulations. Quick and efficient hiring: An Australian EOR can help the company hire and onboard employees quickly and efficiently without the need to establish a legal entity in Australia. Reduced administrative burden: The EOR takes care of all employment-related administrative tasks, allowing the company to focus on its core operations. Flexibility: The EOR can provide flexibility in terms of the duration of the employment agreement, making it easier for companies to manage their workforce. Risk management: The EOR can help mitigate risk by ensuring compliance with all applicable laws and regulations, protecting the company’s brand and reputation. How to choose the right EOR for your expansion into Australia Selecting the right Employer of Record (EOR) is essential when expanding your business into a foreign country like Australia. EORs are not a one-size-fits-all solution, and it is crucial to consider several factors before selecting the best EOR for your business. Location of operation The first consideration when choosing an EOR for expansion into Australia is to determine whether the EOR in fact does operate in Australia. It is essential to choose an EOR that owns its entities in the countries it services, as partnering with a third-party provider can lead to potential pitfalls. This can slow down everyday processes like hiring and payroll processing times and pose a security risk. Working with so-called “global EORs” means you also don’t have the benefit of a provider that has boots on the ground – these larger outfits tend to have less experience in local employment law and can Data and information protection Your EOR will work with sensitive corporate information, so it is vital to ensure they have the appropriate data protections in place to safeguard your confidential information. It is advisable to select an EOR that automates common HR and IT tasks such as onboarding and benefits enrollment to save you time and effort. Support model When choosing an EOR, it is crucial to consider their support model, not just for your internal teams but also for your employees on the ground in Australia. Ensure that your EOR has support staff that is easy to contact and experts in the regulations of Australian employment law. It is also essential to consider whether an EOR makes financial sense for your business. For instance, businesses with a substantial presence in the country may prefer to establish a business entity in the country rather than use an EOR. Cost The cost of using an EOR depends on several factors, including the number of employees you employ through the EOR, the services you require, and the EOR’s pricing structure. EORs typically use one of two pricing structures: a fixed monthly fee per employee or a percentage of payroll plus applicable taxes. Be sure to fully understand your contract and the total cost of working with the EOR before signing. An Employer of Record can be a valuable partner for international businesses looking to expand into the Australian market and hire talent quickly and efficiently. By partnering with an Australian EOR, businesses can ensure compliance with local employment laws and regulations, reduce administrative burden, and focus on their core operations and growth strategies. Contact an ANZPEO today to learn more about how we can help your business thrive in Australia.
Australia payroll services: how PEOs can help global businesses pay their employees wages
As globalisation continues to bring businesses closer together, more and more foreign companies are expanding into Australia. However, managing global payroll for Australian workers can be a challenging task, especially for companies that are not familiar with the country’s complex payroll laws and regulations, or they haven’t established a legal entity in the country. In such instances, engaging the help of a Professional Employer Organisation like ANZPEO will enable these organisations to hire through a legal Employer of Record, meaning the PEO manages payroll for the organisation as their workers’ legal employer. What is a Professional Employer Organisation (PEO)? PEOs are companies that provide outsourced HR services, including global payroll services, to other businesses. They can assist overseas businesses by handling their Australian workers’ payroll and ensuring compliance with Australian payroll regulations. In the instance where the PEO is also the Employer of Record for an organisation’s full time employees, the PEO becomes the legal employer. For every pay run, you, the client organisation, pays ANZPEO your workers’ wages, and ANZPEO pays those funds to the employee as their legal employer. Here are some of the ways that PEOs can help overseas businesses process payroll for their Australian workers: Knowledge and expertise in Australia payroll regulations One of the main advantages of using a PEO is that they have expert knowledge of payroll laws and regulations of the Australian government. This means they can help overseas businesses comply with these regulations, which can be complex and challenging to navigate. By working with a PEO, businesses can avoid potential legal issues and penalties that may arise from non-compliance. Simplified payroll processing Processing payroll for Australian workers can be a time-consuming and complicated task. PEOs can simplify this process by providing efficient and accurate payroll services. They can also handle other payroll-related tasks such as superannuation contributions, employee benefits, severance pay and annual leave or parental leave management. When it comes to tax services, PEOs can assist businesses with tax contributions by ensuring compliance with local tax laws and regulations, calculating and deducting taxes from employee salaries, making tax payments to the appropriate authorities, facilitating payroll tax and making contributions to payroll taxes, and providing accurate tax reporting and documentation to businesses. Access to advanced payroll and HR software PEOs use advanced payroll software to manage payroll processing. By working with a PEO, businesses can access this software without having to purchase it themselves. This can help them securely store and manage an employee’s personal information, such as their Tax File Number (Australia’s equivalent to the U.S Social Security Number), and save money on software and IT costs while also benefiting from the latest payroll processing technology. Managing employee payroll through a PEO also offers significant benefits to an organisation’s employees. Many offer employee self service CRMs that allow them to log hours and manage leave entitlements through the platform rather than requesting them from their employer. Reduced administrative burden Managing employee payroll can be a significant administrative burden for businesses, especially for those that are expanding overseas. Organisations that choose to outsource payroll processing to a PEO can reduce their administrative workload, allowing them to focus on other core business activities. Flexibility and scalability PEOs can provide businesses with flexibility and scalability in managing their Australian workers’ payroll. They can offer customised payroll solutions to meet businesses’ specific needs, whether they have one employee or hundreds. As business growth picks up pace, PEOs can also scale their services to meet the growing payroll needs. How can ANZPEO help your international business manage your payroll in Australia? For overseas businesses expanding into Australia, managing Australia payroll can be a daunting task. By partnering with ANZPEO, you can benefit from expert knowledge, simplified payroll processing, advanced software, reduced administrative burden, and flexibility and scalability, without having to establish a legal entity in the country. Outsource payroll processing to ANZPEO so you can focus on your core business activities while ensuring compliance with Australia payroll regulations. Speak to us today.
How PEOs can assist in resolving workplace conflicts
As a business owner or manager, managing employee relations and resolving workplace conflicts can be a time-consuming and challenging task. These issues can affect not only the morale and productivity of your employees but also the overall success of your business. This is where a Professional Employer Organisation (PEO) can provide valuable support. First, what is a Professional Employer Organisation (PEO)? A Professional Employer Organisation (PEO) such as ANZPEO is a company that provides outsourced human resources services to businesses. A PEO acts as a Employer of Record, taking on responsibilities such as payroll processing, employee benefits administration, HR compliance, and worker’s compensation coverage. A PEO is a strategic partner that can help you effectively manage employee relations and resolve workplace conflicts by providing various HR services, including conflict resolution and employee relations management. By outsourcing HR responsibilities to a PEO, businesses can focus on their core operations while ensuring that their employees are well taken care of. Workplace disputes and conflicts can take many forms, but some common examples include: Interpersonal conflict between employees or between an employee and a supervisor Disagreements over workload distribution or job responsibilities Conflicts related to unequal treatment or discrimination Issues surrounding pay or benefits Disputes over harassment or bullying in the workplace Conflicts over work schedules or time off requests Differences in opinions or misunderstandings over company policies or procedures Disputes involving intellectual property or confidentiality Conflict arising from changes in the workplace, such as reorganisation or layoffs Disagreements over the implementation of new technologies or processes It’s important to address workplace conflicts promptly and effectively to maintain a positive work environment and minimise the impact on productivity. How has the prevalence of remote work impacted workplace conflicts? The increased prevalence of remote work due to the COVID-19 pandemic has impacted the frequency and nature of workplace disputes and conflicts. Remote work can affect workplace disputes and conflicts in several ways: Communication breakdowns: One of the biggest challenges with remote work is maintaining clear and consistent communication. This can lead to misunderstandings, misinterpretations, and a lack of clarity about expectations and responsibilities. Isolation and lack of collaboration: Remote work can make it more difficult for employees to work together as a team and to build strong working relationships. This can lead to feelings of isolation, lack of trust, and decreased collaboration, all of which can contribute to workplace disputes. Difficulty in enforcing policies and procedures: It can be more challenging to enforce workplace policies and procedures in a remote work environment. For example, it can be harder to monitor attendance or ensure that employees adhere to company protocols. Blurred boundaries between work and personal life: Remote work can also blur the boundaries between work and personal life, which can lead to conflicts over time management and work-life balance. Technical difficulties: Technical difficulties, such as connectivity issues or problems with software and tools, can also lead to disputes and conflicts in a remote work environment. It is important for organisations to be proactive in addressing the unique challenges of remote work and to have clear protocols and resources in place for employees to communicate, collaborate, and resolve disputes effectively. Here are some ways a PEO can assist in resolving workplace conflicts and maintaining a positive work environment. Expertise and Experience: PEOs have extensive knowledge and experience in the area of employee relations and conflict resolution. Their team of HR experts are equipped with the necessary tools and resources to manage any workplace issue that may arise effectively. They can provide advice and guidance to managers and employees to resolve conflicts before they escalate and also help in developing policies and procedures to prevent similar situations from occurring in the future. PEOs can provide your company with comprehensive employee handbooks and policies that clearly outline the expectations and responsibilities of employees. This helps in preventing conflicts from arising in the first place. Confidentiality: PEOs understand the importance of maintaining confidentiality in the workplace, and they are trained to handle sensitive issues with care and discretion. They can help mediate disputes, provide impartial guidance, and help both parties reach a resolution that is satisfactory to all parties involved. This can help to maintain a positive work environment and prevent the spread of negativity among employees. Employee Training and Development: In addition to providing expert advice and guidance, PEOs can also provide training and development opportunities for employees to help them understand and manage conflict in the workplace. This can include workshops, training sessions, and other resources designed to help employees develop the skills they need to resolve conflicts and maintain a positive work environment. Legal Expertise: PEOs have a wealth of knowledge about employment laws and regulations, which can be invaluable in resolving workplace conflicts. They can provide guidance to your company on the best course of action and ensure that your company stays compliant with all relevant laws. In conclusion, partnering with a PEO like ANZPEO can help companies effectively manage employee relations and resolve workplace conflicts. With their expertise, experience, confidentiality, and training and development resources, PEOs can provide valuable support to companies of all sizes, helping to maintain a positive work environment and keep the focus on business growth and success. More information on effectively resolving workplace conflicts in Australia can be found on the Australian Fair Work Ombudsman’s website. If you’re looking for a PEO in Australia that can help you manage employee relations and resolve workplace conflicts, look no further than ANZPEO. Contact us today to learn how hiring skilled workers through ANZPEO will ensure your workers are provided valuable support throughout their entire tenure.
How will Artificial Intelligence be used to source skilled workers in 2023?
As Australian companies struggle to fill roles with the right talent amid one of the country’s worst skills shortages, many are taking a shot at Artificial Intelligence (AI) to source, interview and match candidates to open roles. It’s been an interesting few weeks for Artificial Intelligence. AI chatbot ChatGPT is being tested to detect early signs of Alzheimer’s, DALL-E is creating images from simple text, and Anthropic is working to build reliable and interpretable AI systems grounded on safety. Following years of disappointment, the technology has finally emerged from its “AI winter” and is making waves in all business areas, including recruitment. Between 35% and 45% of businesses are tipped to use AI talent acquisition technology to help source, shortlist and interview candidates in 2023. Just under three-quarters of businesses increased their spending on talent acquisition software last year, with the vast majority saying they will continue investing in it this year (Modern Hire, 2023). As Australia continues to suffer its most significant labour shortage in decades, businesses are now adopting AI to identify highly skilled candidates and automate some of the lengthy processes involved in shortlisting and selecting the suitable candidates for their open roles. Can AI effectively parse resumes for skilled roles at scale? Hiring managers often have hundreds of resumes and cover letters to scan through in the first round of shortlisting candidates. For skilled roles, there may be only a handful of qualified candidates hidden beneath them. At the best of times, hiring managers can only afford to spend as little as 10 seconds on each resume to identify the relevant qualifications – a specific degree, experience in a particular role etc. even though the vast majority of candidates are not qualified for the position. To solve this challenge, AI technology can identify qualified candidates at scale by crawling the text within each resume and matching it against specific keyword data. Budget airline Air Asia implemented a similar system to identify candidates from the thousands of applications they received based on how their skills managed the requirements of the role. Its recruiting team saved 60% of their screening time as a result. 2023 will leave behind reactionary hiring practises In 2023, businesses will leave behind the era of reactionary hiring and refocus on seeking out quality candidates; those with the right skills and tertiary qualifications but also passion and motivation to learn on the job. According to PwC’s recent report, however, just under half of all candidates decline job offers because of their dissatisfaction with the recruitment process. It’s clear that businesses need to work on their recruitment process, but they also need access to higher-quality skilled candidates to fill difficult positions. One aspect of AI that recruiters can use is data manipulation to analyse hundreds of applications for skilled roles that demand very specific requirements, such as specialists and engineers. “If you think about it, recruiting is a data-centric function with a lot of unstructured data found in people’s resumes and CVs (curriculum vitae),” Rowan said. “The sophistication in this process of matching has evolved from matching up skills with requirements to include analysis that helps determine candidate fitness for the role.” What tools can hiring managers use to shortlist candidate resumes for skilled workers? Utilising artificial intelligence to sift through candidate applications and source the best talent for skilled roles, without gender, age or race bias has become a valuable tool in the back pocket of hiring managers when it comes to filling roles with specific and nonnegotiable requirements. The process of sourcing, posting, searching, parsing and matching capabilities to job posts can save hiring managers an enormous amount of time. So, what are the most popular tools among hiring managers? Skillate Skillate is an SAP-developed talent engagement software for recruiters and hiring managers. The platform will write job descriptions and offer recommendations for more effective keywords. It will collect resumes from multiple sources (owned and third-party mechanisms), and match resumes to job requirements at scale by running them through their machine learning model, ranking and scoring them along the way. ICIMS Talent Cloud ICIMS Talent Cloud is an AI bot that sources, opportunity matches, and suggests skilled workers as candidates to hiring managers. The chatbot will automatically send answers to candidate FAQs and can schedule interviews in over 20 languages. It will parse relevant data from the resumes of each candidate and combine it with publicly available third-party information from sources like LinkedIn to create a unique profile for each candidate. Integrations available: text messaging, WhatsApp, Facebook Messenger and Teams. Fecher Fetcher, an AI-powered recruitment automation tool, employs a straightforward yet efficient 3-step sourcing, engaging, and tracking approach to guarantee a steady flow of suitable candidates and fulfil your hiring requirements. Fecher is particularly useful for hiring managers seeking highly skilled professionals, with a sourcing tool that provides access to the most suitable candidates with specialised skills and backgrounds. In addition, the platform has an automated outreach feature that hiring managers can send cold emails and personalised messages to candidates from. Contact ANZPEO to understand how our expert hiring managers can help you to source, hire and retain skilled workers in Australia.
Creating an Employee Value Proposition that will captivate Australia’s skilled workers
A little while ago, we published an article about the current challenges many Australian businesses are facing in sourcing and hiring top talent. As the country experiences its lowest population growth in three decades, companies are staring down the barrel of widespread skills shortages, record-high wage growth and employment levels, and high demand for goods and services for years to come. Labour shortages have plunged Australia into a candidate-driven market, giving job seekers the upper hand in deciding what roles they consider going for and under what circumstances. Top skilled workers have the luxury of choice when it comes to negotiating better pay and company benefits like flexible working conditions and health insurance. Companies that wish to attract and retain top skilled workers in Australia must consider what it is they value most, and what they look for, in their ideal role. Recognising and acknowledging these values in job descriptions and interviews will ensure businesses attract the most suitable candidates to their open roles. What are candidates looking for in their ideal role in 2023? According to Randstad’s report 2022 Employer Brand Research, salary is no longer the biggest motivator when it comes to choosing a role or changing jobs. 62% of candidates say they want work-life balance in their next role, with 58% saying they want a better salary and benefits, followed by job security (56%), job training (53%) and work atmosphere (51%). According to Seek.com, the top three drivers for candidates in their job hunt align with Maslow’s hierarchy of needs and have largely remained the same for over ten years; salary (survival), work-life balance (connection) and career development (self-growth and development). What’s interesting about this finding is that the top drivers are all about them, not the company. So, while it’s important to address factors like company reputation and culture, candidates will mostly resonate with the areas of an EVP that speak to their individual values. Work-life balance is no longer a “nice to have” aspect of a role but an expectation and, in many cases, a requirement. As workers are expected to meet increasingly tight deadlines and hit targets, they’re working longer hours and taking on responsibilities outside their scope of work. Those with young families who want to return to work also want the flexibility to maintain family life. They want to get the work done in an arrangement that works for them. If it’s work-life balance that candidates are valuing in today’s market, then this will come at an advantage for Australia employers that are feeling the crunch from dwindling revenue in a challenging economy. Companies can now negotiate on terms other than salary. Companies that offer hybrid working conditions (part working from home, part working in office), fully remote conditions and/or flexible working hours can also cast the net wider in their hunt for candidates. Instead of limiting their search to the city they’re headquartered, they can look to regional towns and even overseas. How to create an Employee Value Proposition that will captivate Australia Skilled Workers So how do Australian businesses create an Employee Value Proposition (EVP) that will win over the right candidates? Understanding what candidates want from an employer, and acknowledging these values in their EVP, will help Australian businesses capture the attention of top skilled workers that will help meet their business needs. What is an Employee Value Proposition (EVP): An EVP is a company statement that communicates the unique benefits of your company to prospective employees. It usually covers your company values and culture, as well as things like remuneration, benefits and company perks. It outlines why your organisation is the ideal place for your ideal candidates. According to Vervoe, companies that deliver on an EVP see a 70% decrease in employee turnover and an almost 30% increase in new hire commitment. Although your EVP communicates to candidates and employees what they’ll get in return for working at your organisation, it’s not the same thing as your employer brand, which encompasses the reputation the wider world, not just employees and potential employees, has for your organisation. Your EVP can be as short or as long as it needs to be, so long as it highlights all of the critical elements it needs to include and what’s most important to attract the right candidates. For an EVP that captivates Australian workers in 2023, consider the following: Worklife balance: what factors within your organisation promote a healthy work-life balance? Do you enable your employees to work from home part- or full-time? Do you allow them to choose their own working hours within reason? Part of Hubspot’s EVP encompasses a statement on how they offer unlimited vacation, fully remote work, a five-year sabbatical and parental leave, along with a raft of company perks. They promise to “help you be the best “you” that you can be”. Remuneration: outline how/if you can meet your employees’ salary expectations and include additional rewards such as bonuses, travel allowances and additional paid leave. Also, consider whether or not their salary will be increased periodically – say, by 5% every 12 months – and under what circumstances. Job security: Your EVP should encompass all the ways in which your organisation will protect its employees from layoffs, economic downfalls and other factors that could impact employment. Does your organisation prioritise future-minded leadership? Does it encourage learning and development or have a no-redundancy policy? Career development: include the opportunities you offer employees to further their careers, develop their skills and train them in new areas. This is where you’ll include learning and development efforts such as Professional Development Plans, mentoring and coaching, educational allowances and so on. Affiliation/reputation: skilled professionals don’t want to be associated with a weak brand, poor business performance or Corporate Social Responsibility record. In this section, consider factors like your corporate values, wider reputation, the quality of your product and/or service, growth objectives and position in the marketplace. How your organisation impacts its people and the wider community is a key consideration for
Employer of Record Australia | How to hire workers in Australia remotely
Expanding your business into Australia from countries like the US or UK can be a great way to penetrate the Asia-Pacific market. However, hiring skilled workers on the ground can be challenging without a local entity in Australia and strong knowledge of Australian employment law and compliance. As an international business, there are two options for hiring workers in Australia: Set up a physical entity in Australia to legally hire workers The first and most obvious option for hiring workers is the conventional way; setting up a legal entity in Australia, giving you rights to employ workers in the country. According to the Australian Securities and Investment Commission (ASIC), the legal requirements to set up a physical entity in Australia are as follows: Establish and register a physical office space, place of business and directors Create and manage a business name Keep ASIC informed of key changes Maintain up-to-date financial records Pay relevant fees to ASIC Create and monitor annual statements Engage a trusted legal team to assist in understanding compliance and Australian employment law. For example, suppose a gaming company, let’s call them Radical Gaming, wanted to hire a Software Engineer in Australia the conventional way. In that case, they’d need first to establish a physical office in Australia to then create the legal entity that enables them to employ workers in the country. They would then need to hire a board of directors, create and manage their selected business name and pay relevant ongoing fees to ASIC. This process alone can take months or even years. Engage an Employer of Record to hire workers on your behalf. What is an employer of record? An employer of record (EOR) is a company that acts as the legal employer of workers on behalf of another company for tax purposes. In an EOR employment arrangement, while the employee is technically hired by the EOR, the worker performs work for the other company. EOR services like ANZPEO take on the responsibility of various administrative tasks, from visa and sponsorship to onboarding and payroll. The end company will manage the employee directly. What are the benefits of engaging an employer of record company? When you work with an EOR, you don’t have to familiarise yourself with complex Australian labour law, or other administrative functions like onboarding and payroll. Once you’ve recruited your employee, an EOR like ANZPEO can have your new worker onboarded and ready to start within 24 hours, giving you more flexibility to concentrate on your broader growth strategy and team management. By far, the most significant advantage of engaging an EOR company like ANZPEO is the ability to expand into Australia very quickly and without establishing a local entity. So if the same company, Radical Gaming, had sourced a Software Engineer in Australia, ANZPEO (or the EOR) would onboard and hire them on Radical Gaming’s behalf, becoming the legal employer of record for the engineer. ANZPEO would manage payroll and benefits and offer ongoing HR support for this engineer while they report to and perform tasks for Radical Gaming. Companies that hire skilled workers in Australia through an Australia EOR reap the benefits Hire remote skilled workers in Australia without the hassle: you source your ideal candidate, and we become the employer of record for your Australia-based worker, eliminating the need to set up a legal entity in the country. Fast onboarding: We’ll have your skilled worker signed on and working in as little as 24 hours. Remote HR functions: ANZPEO takes on several administrative tasks from payroll to legal matters, leave entitlements and employee support. Contingent workers benefit from an EOR arrangement too. Contingent – or co-employed – workers are also exposed to several advantages of being employed under an EOR agreement. Accurate payment on time: as experts in Australian labour laws and entitlements, ANZPEO will ensure your workers have their wages paid on time and accurately. Support on the ground: As the only Australia-based EOR for skilled workers in Australia, your company and skilled workers will have access to round-the-clock support from our dedicated Account Management team. Workplace rights protected: When expanding into a different country, you’re legally required to abide by the local employment laws. Employing workers through an Australian EOR such as ANZPEO means your workers can rest assured knowing their workplace rights are being protected. How much does it cost to hire skilled workers in Australia? List most developed countries, there are a number of additional costs of hiring workers in Australia, on top of salary. Firstly employers must pay contributions into an employee’s mandatory superannuation fund (the equivalent to 401K in the US). These amount to 10.5% of the employee’s annual salary. They’re also required to pay around 2% of their salary for workers’ compensation (depending on the policy), 5.45% in payroll tax and – in some cases – 17.5% annual leave loading. For a skilled worker earning a base salary of $120,000, an employer can expect to pay an additional $12,600 in superannuation contributions, $2,400 in workers’ compensation, $6,540 in payroll taxes, and, where applicable, $21,000 in annual leave loading—bringing the total additional costs to $42,540. Would you like to hire workers remotely through an Employer of Record, such as ANZPEO? Our dedicated employment team is based in Australia and ready to assist in employing your ideal candidate. Reach out today.
Employee vs. contractor: which is better for PEO arrangements?
For international businesses wanting to recruit workers in Australia, determining whether or not to hire them on a contract or permanent basis can have a significant impact on their business. A PEO agreement is a unique arrangement that allows international companies to hire workers in countries like Australia without them having to establish a local entity. With this comes certain nuances that need to be acknowledged when deciding whether to hire permanently or on a contract basis. Often, the lines between employer and contractor can be blurred, as both have subtle differences in how agreements are drawn up and work is undertaken. Generally speaking, the key differences are: Contractors and subcontractors are third-party operators that run their own businesses, whether that be as a freelancer or sole trader. They offer their specialised services to an array of businesses and business sizes and use their own processes, internal tools and strategies to complete the tasks their clients require. Permanent employees work within a business they don’t own. They generally don’t have jurisdiction over when, how, where, or why they complete the tasks assigned to them. Breaking it down, the difference between permanent employees and contractors looks like this: Permanent employees Contractors Fixed annual salaries Paid regularly, based on an agreed hourly or daily basis Employed on an ongoing basis Fixed contract length that can vary from weeks to years. General business tasks and project/campaign work. Primarily project-based for fixed deliverables Leave entitlements (annual leave, personal/sick leave etc.) No leave entitlements Employer pays tax on worker’s behalf Contractor manages their own tax and other deductions (or outsources to third-party accountants). Training is provided to fill skill and experience gaps Usually no training providing and hired for their specialist skills Contractor vs. permanent employee – why is proper classification so important? When deciding whether or not to employ a permanent worker or outsource to a third-party contractor in Australia, there are certain legal obligations you need to be aware of. If you don’t classify your workers accurately, you could be in breach of Australia’s employment law. Classifications affect workers’ tax, super and obligations, and you could be penalised for classifying them incorrectly. When a business treats its employees as if they’re contractors, it could be liable for penalties and charges in accordance with Australian employment law. If the Australian Taxation Office catches wind that you’ve improperly classified your staff, you’ll be up for penalties. You’ll have to pay a fine for not deducting tax from your employer as well as super guarantee charges consisting of back payment of your employee’s superannuation contributions, interest and admin fees. According to the Australian Taxation Office (ATO), there is a specific set of workers who are always permanent employees. These include apprentices, trainees, labourers and trade assistants. When you work with PEOs, labour hire or other on-hire arrangements, your business pays the firm, who then pays your worker a salary, pay-as-you-go (PAYG) tax withholding to the ATO, super and fringe benefits tax obligations. For all such arrangements, employing your workers permanently is essential. A full comparison of how the ATO determines permanent employees compared with contractors can be found here. Why hire permanently? While there are some advantages of hiring contractors over permanent employees – flexibility and agility being two – hiring people permanently has far more advantages, particularly when hiring workers remotely by engaging with a professional employment organisation such as ANZPEO. Stability Permanent jobs offer a level of stability that makes them more appealing for professionals, particularly those in specialist professions. When hiring overseas, securing specialist staff can be challenging. Once contracts are signed, specialists are bound by certain law that ensures they don’t leave their employer in the lurch. They are legally obligated to give their employer notice of resignation as set out in their employment agreement. Often this is one month notice. When hiring permanent workers in Australia through a PEO, you also benefit from their skills long-term. It’s stable for the worker and equally stable for your business and teams. Employee career development With permanent employees, companies have more scope to invest in role development and career progression. Eventually, these same employees can work their way up the ranks within the business and take on future leadership roles – they become irreplaceable members of the company and play a key role in your business’s growth. Retention In return for job longevity, companies should expect their retention rates to remain high and their highly skilled professionals to remain in the business. One added benefit of increased retention is minimising staff training. A 2021 study from the HR Industry Benchmark Survey Australia and New Zealand found that the true cost to hire and train new staff is about AU$23,000. It takes an average of 41 days to fill roles, sometimes longer when recruiting for specialist roles. Loyalty Permanent workers also tend to be more passionate, loyal and involved in the success of a business than contractors, who – as external stakeholders – are more detached from the day-to-day triumphs and challenges of a business. They’re more likely to immerse themselves in company culture and social events, unlike contractors who work more independently and come and go. Collaboration Collaboration can be more challenging for workers in PEO arrangements where employees work remotely. Permanent arrangements make it easier for teams to mesh and form solid and collaborative relationships virtually. The benefits of a permanent role are unsurmountable for employees too. Particularly for workers hired through a professional employment organisation, job stability is an essential aspect when there is often no local office as a company base in the country. Unlike contractors, permanent employees are entitled to personal leave (10 working days a year) and holiday leave (20 working days a year). They have their superannuation and PAYG tax contributions made by the employer on their behalf. Many permanent roles also offer benefits like parental leave packages, gym memberships and health insurance that are otherwise not offered to contracted workers for the same businesses. When
Australian business news: Is 2023 the time to expand?
Like much of the developed world, Australian business news hasn’t been too kind on the economic outlook for 2023, with talk of an imminent recession. Australia is experiencing many of the challenges countries like the US, UK, China, and New Zealand are facing. Inflation is hovering at around 7%, energy prices are increasing, and the Reserve Bank of Australia has announced its eighth consecutive rate hike. Globally, there is political unrest in Ukraine and countries like China, and the UK are experiencing inflation, high interest rates and foreign currency market challenges. Australia’ early response to the pandemic Compared to the rest of the world, Australia’s economy has shown resilience to the devastating impacts of COVID, arguably due to firm COVID restrictions nationwide. Targeted lockdowns and tight border closures were aimed at containing the spread of the virus very early on, and vaccination numbers are some of the highest in the world. The government rapidly implemented a raft of economic stimulus’ worth 20% of GDP in the early stages of the pandemic to keep companies in business and minimise the long-term economic impact. A$20 billion was assigned to support businesses and households in the September quarter of 2021 alone. These efforts have paid off. Australia – a country home to just 0.3% of the world’s population – is projected to become the 12th largest economy in the world by 2023, according to Austrade’s benchmark report Why Australia. Other encouraging factors that make Australia an attractive country to expand your business into Low tax: Comparatively, Australia is one of the lowest-taxed countries in the world. 28% of the country’s Gross Domestic Product (GDP) comprises personal income tax and corporate profits. Social security taxes make up just 1% of GDP, compared to the OECD average of 9%. Goods and Services taxes make up just 7% of GDP compared to the OECD average of 11%. Low government debt: whilst Australia does have some public debt; it’s relatively low compared with almost all global economies. A 2021 report by the International Monetary Fund estimated that Australia’s government debt would be 43% of GDP in 2022, compared with the 89% average forecast estimated for developed countries. Growing services sector: the services sector has increased by 3.3% every year over the last 30 years, with the Information, Media and Telecommunication sector growing the fastest at 5% per year, followed by professional, scientific and technical services (4.8%). Source: Austrade’s benchmark report Why Australia. Australia is a leader in innovation International companies have long viewed the Australian public as early adopters of innovation and technological change, making it an exceptional choice to test technological advancements. Key Australian business news facts: Our scientific institutions are in the top 1% of the world in 15% of separate fields of research, including clinical medicine and computer science. The technology sector has grown by 26% since the pandemic’s beginning, becoming the third largest contributor to Australia’s GDP. Australia is ranked fourth in the world for digital consumption and sixth for fintech development, according to Euromonitor. An abundance of top talent that attracts global attention Our highly skilled workforce makes us one of the most forward-thinking nations in the world, ranking in seventh place for university education systems (International Institute of Management Systems) and eighth on the UN’s Human Development Index. Our workforce is among the world’s most highly educated. 47% of employed people hold tertiary qualifications or advanced diplomas. 75% of those working in professional, scientific and technical services and 64% in the information media and telecommunications sector have a tertiary education. In other Australian business news, what’s the economy like right now? As many global economies suffer, Australia’s most recent quarter saw Gross Domestic Product grow by 0.6%, driven by increased household spending, which grew by 1.1% from the previous quarter. Spending on hotels, cafes and restaurants increased by 5.5% as venues reopened and border restrictions eased, and spending on transport services increased by 14%. Vehicle purchases rose by 10% as global supply chain issues were alleviated (source, The Guardian). Household savings-to-income ratio also fell for the fourth consecutive quarter, going from 8.3% to 6.9%. This is commonly seen as a good sign when inflation is high. Australia’s treasurer, Jim Chalmers, has stated that the national economy is “performing solidly in the face of steep headwinds from overseas as well as considerable and compounding pressures on Australian families and businesses”. Although it’s common for quarterly figures to fluctuate, most economists expect Australia’s economy to slow significantly from December onwards but at least avoid a recession at the level expected in the United Kingdom and the United States. Shane Oliver, an economist at AMP, says there are still strong ongoing business investment plans. “The ABS capital spending intentions survey is up about 15% on a year ago… real business investment is expected to grow by around 5% over the year ahead.” Immigration is also on the rise, with borders opening once again. The country is experiencing a sharp increase in new visas for arrivals as the backlog works hard to catch up. The federal government expects net immigration of 235,000 after negative immigration in FY21. “The surge in immigration will help ease the labour shortage and tight jobs market… which in turn will help head off a surge in wages growth to levels well beyond those consistent with the inflation target.” Oliver has also addressed the large backlog of home-building work yet to be completed since COVID lockdowns, despite a 25% fall in new home-building approvals. Oliver also echoes the sentiments of the RBA in that the economy remains resilient. Interest rates will begin to slow in the coming months. The increase in wage growth and energy prices have not been as stark as in other countries, and US inflation is starting to slow and that “should benefit Australia, which is following US inflation with a six-month lag”. You can catch Shane Oliver’s complete response on the AMP website. Will 2023 be the year to expand your business into Australia? Although the
What are the average Australia salaries for skilled workers?
Australia is well known for its strong economy, but the cost of living, particularly in 2022, when inflation is wreaking havoc on society, is very high compared with other countries. Skilled workers, who generally possess tertiary degrees and are more professionally experienced, must be paid a fair wage that reflects their skills, experience, and cost of living. Companies that do not offer their candidates a fair salary will not attract the best talent to take on their roles. If they do, employees are much more likely to shop for a better-paying position sooner. Identifying what fair and reasonable salaries are for your skilled workers can be a challenge, particularly when you’re hiring through a professional employment organisation from a country such as the US or UK. How do Australian salaries compare to the rest of the world? In a report by the Organisation for Economic Co-operation and Development, Australia has the 9th highest average wage globally, sitting at 30% above the world average. As of 2019, the average income earner was taking home around $USD58,000, compared to $US44,000 in the US. The local average salary in Australia is also above that of the UK, Canada and New Zealand. For skilled workers in Australia, however, it varies. They tend to be higher in most professions in the UK but lower than the average salaries for skilled workers in the US. A study conducted by Outsource Accelerator compared the difference in salaries for high-skill roles in Australia, the United States and the UK. All figures indicate annual salary in USD. Role USA UK Australia HR Managers $78,007 $46,669 $66,518 Software Developer $81,994 $39,913 $62,653 Software Engineer $109,087 $44,459 $62,653 Team Leader $75,823 $31,174 $45,428 Senior Project Manager (12+ years’ exp.) $102,318 $80,343 $107,890 Program director (12+ years’ exp.) $69,508 $94,623 $145,972 Accountant $67,190 $72,923 $58,479 Accounting supervisor $79,408 $48,529 $60,195 Labour shortages and increased cost of living have driven wage growth Things have changed a lot since the pandemic. This year’s Skills and Jobs Summit addressed the key economic challenges in Australia today, namely the labour shortage that is driving unemployment down (currently at 3.4%). However, labour shortages typically drive wage growth up, forcing corporations to offer further incentives in the hope of attracting top talent. Short talent supply for skilled jobs in Australia over the last 12 months has forced pressure on several industries and jobs, leading to this sharp increase in pay rises. The Australian Bureau of Statistics announced a 2.6% annual rate of wage growth “after three-quarters of consistent wage growth, driven mostly by wage rises across the private sector,” says Michelle Marquardt, head of Prices Statistics at the ABS. To combat this rapid wage growth, the Australian government has announced key initiatives that aim to promote greater participation in the workforce, for example, encouraging more skilled migrants to acquire 482 visas by increasing the annual immigration intake from 160,000-195,000. How do employee entitlements compare between the UK, US and Australia? Like most countries, employers of Australian workers must also consider employee entitlements to be paid on top of salaries. Such entitlements differ to those of the US and UK. United States Unlike Australia, paid sick leave and paid annual leave are not compulsory offerings under federal US law. However, many states have mandated paid sick leave and many companies offer paid annual leave at their discretion. US companies are required to cover 6.2% of their employees’ salary for social security, 1.45% for Medicare, as well as state and federal taxes. In some instances, large US corporations that do not offer health insurance to their employees are subject to penalties. Employers are not legally obligated to provide pensions or retirement benefits for their employees, though many do provide them with retirement savings plans that contribute to their 401k. United Kingdom In the UK, full-time permanent workers are entitled to 4 weeks (20 working days) per year of paid annual leave and eight days for paid public holidays. Paid sick leave is not mandatory, but some companies might offer a paid sick leave scheme. An additional 8% of a UK employee’s wage must be paid to their pension scheme. Australia In Australia, all full-time permanent workers, regardless of income, are entitled to 20 days (four working weeks) of paid annual leave. For some professions, they’re also entitled to annual leave loading of 17.5% on top of their wage. In addition, workers get ten working days of personal leave per year, which covers sick days and carers’ leave. Both annual and personal leave are accrued pro-rata, but only annual leave gets paid out if not taken. The number of paid public holidays varies from state to state. In New South Wales there are 11, in Queensland there are 9, and in Victoria there are 13. By law, all employers in Australia must also contribute an additional 9.5% of their employees’ salaries to their nominated superannuation fund (equivalent to the 401k plan in the US) Paying your Australian skilled workers an adequate salary will not only ensure they’re able to afford the cost of everyday living, but it will also make your company a secure and fair place to work. Looking to hire workers in Australia? Speak to ANZPEO about how to remunerate your skilled workers correctly and according to their skills, experience and profession.