RCSA Web Survey Round 27 – August 2008. Executive Summary Summary Business confidence has dropped to the lowest since 2001, a drop of 7%. Expectations

RCSA Web Survey

Round 27 – August 2008

Executive Summary

Summary Business confidence has dropped to the lowest since 2001, a drop of 7%. Expectations of

growth have also dropped 2% to 4%.o SA is slightly less confident while WA is slightly more confident

Labour market scores indicate a strong easing in the difficulty of finding appropriate applicants while there remains issues with the skills, capabilities and attitudes

o All locations are finding very similar labour market conditions except SA is getting more applicants for positions

Staff turnover has risen 8% to 36% pa and staff growth has fallen by 1.8% to 7.6% pao Qld has slightly higher turnover and NSW less while SA had higher staff growth while NZ had less

There has been a substantial drop in permanent full-time placements and a rise in on-hire employment and contractor placements.

16% of on-hired employees converted to permanent positions in the last six months while permanent employees converting to on-hired employment was 4%

The majority of placements are on-hire & contractors and the proportion of those placements as part of the total has risen from 84% of all placements to 91% while permanent placements have dropped by 6% rise to 9%

The proportion of total revenue for all services has remained stable with recruitment services accounting for 45% while on-hired employment & contracting is at 50% of the total

o SA and WA get a larger proportion of revenue from on-hired employees & contractors while VIC gets substantially less

o SA gets a smaller proportion of from recruitment services

Note: If locational differences are not mentioned, the differences are insufficient for comment

Executive Summary

Summary – issues of most concern Concerns about the state of the economy have jumped to the top at 84% while

lack of suitable candidates remains the high at 2nd spot. Concerns about the lack of hiring intentions of clients has jumped from 5th place to 3rd. Difficulty in finding suitable recruitment staff has declined 10% to 59%

o NSW is more concerned about immigration issues and least concerned about industrial relations

o VIC is less worried about finding suitable recruitment staffo QLD is more worried about finding suitable recruitment staff and less concerned about

price undercutting, hiring intentions of clients and price undercutting in the industryo SA is more concerned about 9 out of the 17 issues difficultly in retaining suitable

recruitment staff, industrial relations, workers' compensation legislation, maintaining profitability/fee levels, legal issues about on-hired staff, OH&S Issues, unfair dismissal and casuals, employment legislation, difficultly in finding suitable recruitment staff

o WA is more concerned about nine out of the 17 issues legal issues about on-hired staff, employment legislation, difficultly in retaining suitable recruitment staff , immigration issues, workers' compensation legislation, OH&S Issues, difficultly in finding suitable recruitment staff, unfair dismissal and casuals, price undercutting in our industry

o NZ is more worried about lack of hiring intentions by clients, industrial relations, maintaining profitability/fee levels, price undercutting in our industry, restructuring industries and less concerned about difficultly in finding and retaining suitable recruitment staff

Note: If locational differences are not mentioned, the differences are insufficient for comment

Executive Summary - Skills

The top 3 skills with the biggest shortages are non-building professional engineers, associates and technician 6% - 10% drop in demand.

The demand for health professionals and nurses remains static while rising to 3rd and 6th place. The demand for business professionals has slumped 15% and dropped from 2nd to 4th place.

Demand for other skills had generally dropped 6% - 10% and is consistent with a general easing of the economy and labour market conditions

The top 12 skills shortages being:o Non-building professional engineers o Non-building engineering associates and technicians o Health professionals o Business professionals o Building associates and technicians o Nurses o Building professionals o Electrical trades (building) o Non-building electrical/electronic trades o IT and telecommunications professionals o Metal trades o Carpenters and joiners

Excutive summary cont’d

The majority of respondents (84%) source candidates by approaching passive candidates. Nearly three quarters use niche or specialist internet job boards while two thirds use refer a friend incentives

o WA and SA are more likely to approach passive candidates and use refer a friend incentives

o NZ is less likely to use social networking sites

Process

Web surveyo E-mail business heads in both NZ and Australia

o 191 responses

o Data collection began early August 2008 and completed 22 August 2008

o The total annual revenue of respondent companies is $6.07 billion up from $2.29 billion last round. This large change is due to a change in the way the turnover of large companies is accounted for

o The proportion of $100m+ companies decreased by 7% from last round to 3% but the number remained similar as the sample size is larger

Demographics of sampleThe number of sole traders in the sample has increased 4% to 16%

Sole trader16%

Other84%

Trader status

Location differences:There are a higher proportion of sole traders in NZ

$1,691

$1,171

$946

$270

$405

$785

$121

$123

$557

$6,070

39%

30%

29%

9%

9%

13%

6%

4%

28%

0% 10% 20% 30% 40% 50% 60%

NSW

Victoria

Queensland

ACT

South Australia

Western Australia

Tasmania

Northern Territory

New Zealand

(note multiple locations allowed sums to more than 100%)

Location company operates in

28%

19%

16%

4%

7%

13%

2%

2%

9%

0% 10% 20% 30% 40% 50%

NSW

Victoria

Queensland

ACT

South Australia

Western Australia

Tasmania

Northern Territory

New Zealand

Proportion of revenue generated by location

Demographics of sampleThe total annual revenue of respondent companies is $6.07 billion up from $2.29 billion last round. This large increase is due to a change in the way the turnover of large companies is accounted for.

Total

Ann

ual r

even

ue $

m

Total Australia=$5.52bApprox 91% of revenue

Demographics of sampleThe proportion of $100m+ companies decreased by 7% from last round to 3% but the number is similar as

the sample size has increased.

22

48

11

10

6

3

0 10 20 30 40 50 60

Under $1m

$1M to $5M

$5M to $10M

$10M to $20M

$20M to $100M

$100M and above

% of sample

Annual turnover of companies

Number of clients in the last 3 months

7

13

30

17

26

7

0 10 20 30 40

1 thru 9

10 thru 19

20 thru 49

50 thru 99

100 thru 499

>500

% of sample

Number of clients in last 3 months

Mean Minimum MaximumNumber of clients interacted with in the last 3 months 187.70 1.00 5,500.00

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

August (2008)

April (2008)

December (2007)

September (2007)

June (2007)

March (2007)

December (2006)

September (2006)

June (2006)

February (2006)

November (2005)

August (2005)

April (2005)

December (2004)

September (2004)

June (2004)

April (2004)

December (2003)

September (2003)

June (2003)

March (2003)

December (2002)

September (2002)

July (2002)

February (2002)

December (2001)

September (2001)

58%71%73%

71%75%

78%70%

74%68%

71%66%

72%76%

72%74%75%

70%76%76%

74%69%

84%67%

81%85%

63%78%

26%20%

22%18%

21%16%

20%19%

26%23%

29%27%18%

18%16%

19%22%

19%20%

19%20%

12%18%

13%8%

17%13%

16%9%

6%10%

5%6%

10%7%6%6%6%

1%6%

10%10%

6%8%

5%4%

7%11%

4%15%

6%7%

20%9%

Confidence that business will improve in the next 3 months

%Agree %Neutral %Disagree

RCSA members confidence about business improvements in the next three months has decreased considerably

DifferencesNone

Business confidence has dropped to the lowest since 2001, a drop of 7%. Expectations of growth have also dropped 2% to 4%.

Scale:0=strongly disagree50=neutral100=strongly agree

DifferencesNone

60.0

70.0

80.0A

ve

rag

e

I am confident that our business will improve over the next three months

2%3%4%5%6%7%8%

Av

era

ge

Volume (%) your business will change next quarter

Location differences:SA is slightly less confident while WA is slightly more confident

Staff turnover has risen 8% to 36% pa and staff growth has fallen by 1.8% to 7.6% pa

Differences•Qld has slightly higher turnover and NSW less while SA had higher staff growth while NZ had less

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

Sep

t (2001)

Dec (2001)

Feb

(2002)

July (2002)

Sep

t (2002)

Dec (2002)

Mar (2003)

Jun

(2003)

Sep

t (2003)

Dec (2003)

Ap

ril (2004)

Jun

e (2004)

Sep

t (2004)

Dec (2004)

Ap

ril (2005)

Au

g (2005)

No

v (2005)

Feb

(2006)

Jun

(2006)

Sep

t (2006)

Dec(2006)

March

(2007)

Jun

e(2007)

Sep

t(2007)

Dec(2007)

Ap

ril(2008)

Au

g(2008)

Av

era

ge

Staff turnover (% annualised)

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

Sep

t (2001)

Dec (2001)

Feb

(2002)

July (2002)

Sep

t (2002)

Dec (2002)

Mar (2003)

Jun

(2003)

Sep

t (2003)

Dec (2003)

Ap

ril (2004)

Jun

e (2004)

Sep

t (2004)

Dec (2004)

Ap

ril (2005)

Au

g (2005)

No

v (2005)

Feb

(2006)

Jun

(2006)

Sep

t (2006)

Dec(2006)

March

(2007)

Jun

e(2007)

Sep

t(2007)

Dec(2007)

Ap

ril(2008)

Au

g(2008)

Av

era

ge

Staff growth (% annualised)

While still difficult, there has been an easing in the difficulty of finding appropriate applicants.

Scale:0=strongly disagree50=neutral100=strongly agree

Differences•All locations are finding very similar labour market conditions except SA is getting more applicants for positions

20

30

40

50

60

70

80

Sep

t (2001)D

ec (2001)F

eb (2002)

July (2002)

Sep

t (2002)D

ec (2002)M

ar (2003)Ju

n (2003)

Sep

t (2003)D

ec (2003)A

pril (2004)

Jun

e (2004)S

ept (2004)

Dec (2004)

Ap

ril (2005)A

ug

(2005)N

ov (2005)

Feb

(2006)Ju

n (2006)

Sep

t (2006)D

ec(2006)M

arch(2007)

Jun

e(2007)S

ept(2007)

Dec(2007)

Ap

ril(2008)A

ug

(2008)

Av

era

ge

s

Labour market scores

It is easy to f ind appropriate applicants for positions

Applicants generally have the appropriate work ready attitudes

Applicants generally have the right mix and level of skills

Applicants generally have the right capabilities

Irrespective of appropriateness there are at least as many applicants for positions as needed

0% 20% 40% 60% 80% 100%

It is easy to find appropriate applicants for positions

Applicants generally have the appropriate work ready attitudes

Applicants generally have the right mix and level of skills

Applicants generally have the right capabilities

Irrespective of appropriateness there are at least as many applicants for positions as there are positions

16%

34%

27%

53%

36%

14%

34%

28%

28%

8%

70%

33%

45%

18%

56%

Labour market

%Agree %Neutral %Disagree

Labour market scores indicate a strong easing in the difficulty of finding appropriate applicants while there remains issues with

the skills, capabilities and attitudes

-8%

-10%

-14%

+8%-8%

+8%

Staff placed and on-hired workersThere has been a substantial drop in permanent full-time placements and a rise in

on-hire employment and contractor placements. 16% of on-hired employees converted to permanent positions in the last six months while permanent

employees converting to on-hired employment was 4%.

August 2008

April 2008

Note: variability may arise because of a few large numbers – this is a problem of small data sets

Mean Minimum MaximumPermanent full-time placements 169.37 0 5,437Permanent part-time placements 8.26 0 260On-hire employment 853.46 0 40,000Contractors 75.20 0 5,000

Mean Minimum MaximumPermanent full-time placements 115.23 0 5,406Permanent part-time placements 7.33 0 500On-hire employment & contractors 1,179.62 0 130,000

On-hired employees converting to permanent - last six months% 16.41 0.00 100.00Permanent employees converting to on-hired - last six months% 4.08 0.00 100.00

The majority of placements are on-hire & contractors and the proportion of those placements as part of the total has risen from 84% of all placements

to 91% while permanent placements have dropped by 6% rise to 9%

12%4% 7% 4% 5%

9%

14% 11%5% 5%

13%5% 5%

10% 7% 6%13% 15%

9%

1% 1% 0% 0% 0% 1%2% 2% 0% 1% 1% 0% 1% 1% 0% 0% 1% 1% 1%

86%

95%93% 95%

94% 90%85% 87%

94% 95%85%

95% 95%90% 93% 94%

86% 84%91%

0%

20%

40%

60%

80%

100%

Ave

rag

ePlacement by type (%)

Permanent full-time placements Permanent part-time placements

On-hire employment & contractor

The proportion of total revenue for all services has remained stable with recruitment services accounting for 45% while on-hired employment &

contracting is at 50% of the total

Difference from average•SA and WA get a larger proportion of revenue from on-hired employees & contractors while VIC gets substantially less•SA gets a smaller proportion of from recruitment services

44%

47%52%57%

48%51%

51%47% 47%

51% 52% 50%45% 43%

47% 48%45%

50%45%

38% 37% 37% 35%

43%

37%

44% 43% 43%45% 45%

42% 43%47%

43% 43%48%

45%49%

0%

10%

20%

30%

40%

50%

60%

70%

Ave

rag

eService revenue (%)

On-hired employee & contractor services Recruitment services

A substantial proportion of companies have neither contractors nor on-hire employees.

16

14

13

7

14

16

9

12

0 5 10 15 20

None

1 thru 19

20 thru 49

50 thru 99

100 thru 199

200 thru 499

500 thru 1999

>2000

% of sample

On-hire & contactor numbers on books

30

26

25

13

27

30

17

23

0 10 20 30 40

None

1 thru 19

20 thru 49

50 thru 99

100 thru 199

200 thru 499

500 thru 1999

>2000

Number

On-hire & contractor numbers on books

The majority of respondents (84%) source candidates by approaching passive candidates. Nearly three quarters use niche or specialist internet job boards while two thirds use refer a friend

incentives

6

31

46

67

72

84

0 20 40 60 80 100

Second Life or other virtual worlds

Other

Social networking sites (e.g Facebook LinkedIn

MySpace)

Refer a f riend incentives

Increasing the use of niche/specialist internet

job boards

Approaching passive candidates

% of sample

Media used to source candidates

Differences•WA and SA are more likely to approach passive candidates and use refer a friend incentives •NZ is less likely to use social networking sites

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Restructuring industries

Industrial relations

Difficultly in retaining suitable recruitment staff

Financing growth

Cost of advertising

Maintaining profitability/fee levels

Price undercutting in our industry

Difficultly in finding suitable recruitment staff

Lack of hiring intentions by clients

Lack of suitable candidates

State of the economy

28%

29%

32%

32%

42%

50%

51%

59%

67%

83%

84%

72%

71%

68%

68%

58%

50%

49%

41%

33%

17%

16%

%Agree %Disagree

Concerns for the present and near future (all respondents)

Concerns about the state of the economy have jumped to the top at 84% while lack of suitable candidates remains the high at 2nd spot. Concerns about the lack of hiring intentions of clients has jumped from 5 th place to 3rd. Difficulty in

finding suitable recruitment staff has declined 10% to 59%.

0% 20% 40% 60% 80% 100%

Occupational Health and Safety Act (NZ)

Accident Compensation Act (NZ)

ACC levies (New Zealand)

Immigration issues (NZ)

Employment Relations Act (NZ)

New Zealand

Workers' compensation legislation (Australia)

Unfair dismissal and casuals (Australia)

OH&S Issues (Australia)

Immigration issues (Australia)

Employment legislation (Australia)

Legal issues about on-hired staf f (Australia)

Australia

30%

36%

46%

46%

49%

28%

31%

33%

40%

42%

44%

70%

64%

54%

54%

51%

72%

69%

67%

60%

58%

56%

%Agree %Disagree

Concerns for the present and near future (National issues)

In Australia concerns about legal issues (45%) and employment legislation (42%) remain the top issues but have each dropped 10% while in NZ the employment relations act is the top issue. Immigration

concerns have lessened 20%

Location differences

Note: <50=less than neutral50=neutral>50 = greater than neutral

Compared to average•NSW is more concerned about immigration issues and least concerned about industrial relations•VIC is less worried about finding suitable recruitment staff•QLD is more worried about finding suitable recruitment staff and less concerned about price undercutting, hiring intentions of clients and price undercutting in the industry•SA is more concerned about 9 out of the 17 issues difficultly in retaining suitable recruitment staff, industrial relations, workers' compensation legislation, maintaining profitability/fee levels, legal issues about on-hired staff, OH&S Issues, unfair dismissal and casuals, employment legislation, difficultly in finding suitable recruitment staff •WA is more concerned about nine out of the 17 issues legal issues about on-hired staff, employment legislation, difficultly in retaining suitable recruitment staff , immigration issues, workers' compensation legislation, OH&S Issues, difficultly in finding suitable recruitment staff, unfair dismissal and casuals, price undercutting in our industry•NZ is more worried about lack of hiring intentions by clients, industrial relations, maintaining profitability/fee levels, price undercutting in our industry, restructuring industries and less concerned about difficultly in finding and retaining suitable recruitment staff

Variable NSW VIC Qld SA WA NZWeighted

aveSubstantially less than averageSubstantially more than average

State of the economy 81.00 84.00 91.00 82.00 88.00 87.00 85.38Lack of suitable candidates 85.00 79.00 88.00 82.00 80.00 81.00 82.99Lack of hiring intentions by clients 72.00 69.00 56.00 75.00 71.00 88.00 71.38Difficultly in finding suitable recruitment staff 68.00 60.00 76.00 73.00 78.00 51.00 65.91Difficultly in retaining suitable recruitment staff 38.00 30.00 44.00 60.00 52.00 29.00 38.42Financing growth 31.00 30.00 28.00 27.00 30.00 35.00 30.64Maintaining profitability/fee levels 49.00 55.00 44.00 69.00 54.00 61.00 53.16Price undercutting in our industry 54.00 50.00 44.00 60.00 61.00 61.00 53.53Restructuring industries 26.00 26.00 29.00 21.00 22.00 35.00 27.64Cost of advertising 36.00 40.00 41.00 40.00 39.00 35.00 38.11Industrial relations 21.00 26.00 29.00 47.00 36.00 38.00 29.70Workers' compensation legislation (Australia) 30.00 23.00 27.00 47.00 43.00 30.21Employment legislation (Australia) 45.00 40.00 42.00 53.00 61.00 45.36Legal issues about on-hired staff (Australia) 44.00 45.00 46.00 60.00 65.00 48.21Immigration issues (Australia) 47.00 36.00 44.00 50.00 58.00 44.94OH&S Issues (Australia) 36.00 28.00 33.00 47.00 48.00 35.40Unfair dismissal and casuals (Australia) 35.00 30.00 26.00 44.00 42.00 33.01

Skills shortages by occupation

32%

26%

25%

16%

18%

22%

17%

17%

17%

9%

13%

12%

12%

15%

7%

8%

12%

9%

8%

6%

14%

15%

12%

20%

15%

8%

12%

10%

10%

17%

13%

13%

12%

8%

16%

15%

11%

12%

12%

14%

12%

14%

12%

22%

15%

14%

14%

12%

12%

19%

13%

13%

13%

16%

27%

20%

12%

13%

17%

18%

1%

1%

1%

5%

2%

1%

6%

3%

4%

5%

2%

3%

2%

1%

4%

4%

3%

3%

1%

1%

1%

1%

1%

3%

1%

1%

2%

0%

0%

4%

0%

1%

0%

1%

2%

3%

1%

1%

1%

1%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Non-building professional engineers

Non-building engineering associates and technicians

Health professionals

Business professionals

Building associates and technicians

Nurses

Building professionals

Electrical trades (building)

Non-building electrical/electronic trades

IT and telecommunications professionals

Metal trades

Carpenters and joiners

Plumbers

Medical technicians

Receptionists and telephonists

IT and telecommunications technicians

Bricklayers

Roofers

Vehicle trades

Mobile plant operators

Supply of skills by occupation in order of total shortage

Shortage long term

Shortage short term

Neutral

Over supply short term

Over supply long term

Skills shortages by occupation – top 20 The top 3 skills with the biggest shortages are non-building professional engineers, associates and technician 6% - 10% drop in

demand. The demand for health professionals and nurses remains static while rising to 3 rd and 6th place. The demand for business professionals has slumped 15% and dropped from 2nd to 4th place. Demand for other skills had generally dropped 6% - 10% and is

consistent with a general easing of the economy and labour market conditions.

To

tal

sho

rtag

e

46%40%36%36%33%30%29%28%27%27%26%25%24%24%23%23%23%21%20%20%

3%

8%

9%

9%

4%

5%

8%

4%

7%

6%

8%

9%

4%

4%

4%

5%

3%

4%

5%

7%

2%

16%

11%

9%

10%

14%

13%

9%

13%

9%

7%

5%

4%

9%

9%

9%

7%

8%

7%

6%

3%

6%

23%

21%

19%

13%

30%

21%

19%

25%

32%

23%

27%

23%

27%

21%

20%

23%

23%

23%

23%

30%

24%

2%

3%

0%

3%

4%

2%

3%

1%

8%

1%

1%

3%

2%

5%

4%

2%

5%

1%

1%

1%

4%

4%

3%

1%

1%

2%

1%

2%

1%

9%

2%

2%

2%

1%

2%

0%

1%

1%

1%

3%

1%

1%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Sales staf f (not professionals)

IT and telecommunications trades

School teachers

Wall tilers

Other clerks

Machine and stationary plant operators

Drivers

Trades assistants and factory hands

General managers

Social professionals

Scientists

Scientif ic technicians

Other personal service workers

Building & construction labourers

Food trades

Rail drivers

Waiters and restaurant staf f

Agricultural labourers

Mining labourers

Farm managers

Cleaners

Supply of skills by occupation in order of total shortage

Shortage long term

Shortage short term

Neutral

Over supply short term

Over supply long term

Skills shortages by occupation – bottom 20

To

tal

sho

rtag

e

19%19%19%19%18%17%17%17%16%14%13%13%13%13%13%12%11%11%10%10%8%

Top 10 skill shortages by location

NSW1. Non-building professional engineers

2. Non-building engineering associates and technicians

3. Business professionals

4. Building associates and technicians

5. IT and telecommunications professionals

6. Health professionals

7. Building professionals

8. Electrical trades (building)

9. Nurses

10. IT and telecommunications technicians

VIC1. Non-building professional engineers





6. Non-building electrical/electronic trades




10. Plumbers


Queensland1. Non-building professional engineers








9. Nurses


South Australia1. Electrical trades (building)





6. Carpenters and joiners

7. Non-building professional engineers

8. Nurses


10. Plumbers


Western Australia










10. Plumbers

New Zealand




4. Nurses



7. Metal trades




Documents

RCSA Web Survey Round 27 – August 2008. Executive Summary Summary Business confidence has dropped to the lowest since 2001, a drop of 7%. Expectations