The Great Resignation: Is it Coming to an End in Australia?
Key Points
- Employee turnover, which peaked at 21.4% in 2022, has now fallen to 10.8% at the start of 2024.
- Organizations are shifting focus towards managing costs and optimizing current workforce rather than aggressive hiring.
- Overall salary increases have remained stable at 4% in 2024.
New data on the Australian workforce suggests that the trend of the great resignation may be slowing down, especially in Australia. Findings from Mercer’s Total Remuneration Survey, part of the Australian Salary Outlook 2025, indicate that employees are now seeking job stability in uncertain times and are less inclined to switch jobs.
The pandemic initially led to a surge in employee turnover, with a peak rate of 21.4% in 2022, termed the great resignation by economists. However, there has been a noticeable decline in turnover, with the rate dropping to 18.6% in 2023 and further down to 10.8% in the first half of 2024.
According to the outlook, workers are now prioritizing security in their roles, leading to a shift where retention is valued over recruitment. Employers have also observed a decrease in staff turnover, with 42% planning to maintain current headcounts.
The report highlights that with employee retention strengthening, organizations are now focusing on managing costs and optimizing existing workforce rather than aggressively seeking new hires, particularly in a subdued economy.
Simultaneously, the labor market is rebalancing, with job vacancies decreasing to 2.2%, the lowest in over three years. Employers are gaining confidence in managing turnover, with 64% feeling in control, a significant increase from 55% in 2023, marking the highest level of confidence in four years.
The survey also notes that overall salary increase budgets remained at 4% in 2024 and are forecasted to stay stable at that rate in 2025. Additionally, the report examined salary movements across different industries.
While the labor market may favor employers, certain industries have seen substantial salary growth in the past year.
Industry Salary Trends
While the average salary increase remained at 4% for Australians, some science-related roles experienced significant wage growth:
- Salaries for entry professional science roles like chemists, product research scientists, and hydrologists increased by nearly 20%.
The report attributes this growth to the scarcity of certain related skills in the market.
Conclusion
The data from Mercer’s Total Remuneration Survey and the Australian Salary Outlook 2025 suggests a shift in the Australian workforce dynamics, with a decline in the great resignation phenomenon. Employees are now prioritizing job stability, leading to a decrease in turnover rates and a focus on retention over recruitment. As organizations navigate a changing landscape, managing costs and optimizing existing workforce have become key priorities, while the labor market sees a rebalancing effect. While overall salary increases have remained steady, certain industries have witnessed significant wage growth, particularly in science-related roles where specific skills are in high demand.
FAQs
1. What is the current employee turnover rate in Australia?
The employee turnover rate in Australia has declined from 21.4% in 2022 to 10.8% in the first half of 2024.
2. How are organizations adapting to the changing workforce dynamics?
Organizations are now focusing on managing costs and optimizing their existing workforce, prioritizing retention over aggressive recruitment.
3. Are salary increases expected to continue at the same rate in 2025?
Overall salary increase budgets are forecasted to remain stable at 4% in 2025, as indicated by the Australian Salary Outlook 2025.