Uncertainty, cost of living and inflation will shape the jobs market in 2023

At the start of a new year and it feels like we’ve been here before: an ongoing pandemic, economic uncertainty and some interesting trends among employees promise to make 2023 a tricky year for business leaders, HR managers and workers alike.

New LinkedIn data says 59% of Australian workers are considering a change in jobs this year and 41% feel confident in securing a new role. This confidence flies in the face of economic factors that would typically convince staffers to stay put.

Indeed, survey results released this morning from CPA Australia suggest that uncertainty for business will flow down to workers, with 17% of respondents reporting they feel insecure about their position, and 12% saying they don’t know what their job situation will be this year.

“We’re seeing the uncertainty facing businesses and consumers spill over into confidence,” said Gavan Ord, CPA Australia senior manager business policy. 

Discussing the LinkedIn survey findings with SmartCompany, LinkedIn careers expert Cayla Dengate said: “Coming into 2023, this research shows that a lot of people have banked up that resilience and confidence since the pandemic. So there’s this real sense that we’ve stepped out of the peak of the pandemic, there’s a sense of optimism moving forwards.”

“Australians are not putting their careers on the backseat despite the uncertain environment, and are instead driving forward, trusting their abilities and looking to grow their careers.”

Roll that all in with a 3.5% unemployment rate, and you can expect uncertainty to remain the norm and the jobs market to stay tight for at least the next little while.

So how can employers keep their workers out of that cohort of workers looking around at the moment? On the other side of the same token, how can they fill positions and entice the workers already out there on the hunt? Again reflecting that economic uncertainty, it appears to come down to cash. The top thing participants in the LinkedIn survey were looking for in a new role is a bigger pay packet.

“Last year it was flexibility coming in at number one,” said Dengate. 

“I think that probably shows that the cost of living crisis and inflation means that people are thinking about their pay packet a little more this year than they were last year. That’s just one additional interesting factor to throw into the mix for employers who are looking to attract and retain the best staff.”

Flexibility does remain a major factor. The effects of this pandemic have all but cemented working from home as a must-have. In an Employment Hero study from late last year, 50% of hybrid and remote workers said they’d quit their jobs if their management opted for a full-time return to the office. That number increased to 61% for millennials. 

Thanks to bleak home ownership prospects in major cities, working from home also continues the trend of moving bush: 64% of workers in the Employment Hero study have considered relocating further away from the office and 76% have considered working remotely on a permanent basis.

Low unemployment, a tight market and hybrid work are but a few of the factors and trends that employers will need to take into consideration this year. Skills shortages, mental health, workplace culture, diversity and the increased participation of a values-driven generation Z in the workforce are all sure to play a role.

This article was part of a feature series on workplace and employment trends to support our Smart50 Workplaces 2023 program, developed in partnership with Employment Hero.

Download the ‘What are great employers doing differently in 2023?’ report to look at current trends in the employment landscape and best practices from Smart50 Workplaces Top Performers.