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The number of women on the boards of Australia’s 300 biggest companies is higher than ever, but those who get a seat at the table are usually already part of the club, as directors face rising expectations to serve the public interest as well as shareholders.

A new report by governance advisory firm Ownership Matters analysed the board composition of ASX 300 companies in 2022 and found women now occupy 34.2 per cent (or 717) of board positions, up from just 9.6 per cent in 2005.

But the top job is still predominantly a man’s game: only 33 women hold the position of chairperson. Just four companies across the ASX 300 had both a female chair and a female CEO (AMP, Bendigo & Adelaide Bank, Lynas, and Spark New Zealand).

While gender diversity is increasing, it tends to be the same women at the table: of the 13 instances in which an individual director held four directorships, 10 of them were women.

“We’re extending out diversity – [but] we’re just appointing more of the same person,” said Ownership Matters co-founder and director Dean Paatsch.

Male directors are getting older and sitting at the table for longer: 51 per cent of non-executive male directors on the boards of ASX 300 companies are aged 60-69, with a further 22 per cent aged 70 or older.

More broadly, directors are facing increasing scrutiny from the public to ensure they are not sacrificing the interests of other stakeholders, such as customers, in favour of the interests of shareholders.

Over the past week, Qantas chair Richard Goyder – who also chairs the AFL and sits on the board of Woodside – has faced mounting calls for his resignation amid the dominant airline’s various legal battles. Late last year, the AGL board was successfully overhauled by Atlassian co-founder Mike Cannon-Brookes, who built an 11 per cent stake and forced through more ambitious pledges to reduce the energy giant’s enormous carbon footprint.

“Society is changing in terms of making sure you’re getting the right balance between your social licence to operate and making money for shareholders,” said Paatsch.

However, he said Australians tended to be reluctant to remove underperforming directors when companies lost their way, noting only about five have been removed from office in non-takeover situations over the past 15 years.

“We’re very accepting of mediocre board performance until there is a massive crisis, and then it’s all the board’s fault. Boards don’t matter until they do,” said Paatsch. “And when they do, you really want them to be decisive and open and honest and clean up the mess.”

In Qantas’ case, it would not be enough to call for Goyder’s resignation; an alternative must be put forward, he said. “It’s never who you fire, it’s who you hire.”

In 2022, non-executive ASX 100 board directors were paid $274,936 on average, up from $267,933 in 2021. The average pay of ASX 300 chairs had the greatest increase, to $207,192 in 2022 from $190,278 in 2021.

The number of independent directors with no “skin in the game” – that is, personal investments in shares that brings them in alignment with shareholders – remains “disappointingly” high: 50 ASX 100 directors, 72 ASX 200 directors and 86 ASX 300 directors have no skin in the game.

The longest-serving of these is Michael Harvey, son of Harvey Norman founder and chairman Gerry Harvey, who has served on the white goods retailer’s board for 29 years without owning shares.

There are no laws that impose limits on how long a director can serve. “You can sit on [a board] in perpetuity,” said Paatsch.

While the executive management teams of ASX-listed companies tended to be scrutinised through the performance and strategy of the company, the individual contributions and performances of directors was not as clear, said Paatsch. New board directors are selected through specialist external recruitment firms, or through suggestions from existing board members.

“If the chairman says, ‘Look, I’ve got this fabulous [candidate]’ ... you’ll probably find that you’d get the gig,” Paatsch said.

“The bigger picture really here is there’s still a lot of work to be done to make sure that non-executive director appointments are based on merit and competency rather than patronage, association or past appointments.”

A recent report from Gallup has highlighted the significant economic impact of employee disengagement. By making simple changes to management behaviours, HR can turn this challenge into an opportunity for growth.

A new report by Gallup has revealed that a staggering four in five employees in Australia are feeling disengaged and disconnected from their work.

According to Gallup’s 2023 State of the Global Workplace report, two thirds of the workforce is passively disengaged, while 13 per cent is actively disengaged – i.e., taking actions that directly harm the organisation and its goals. Just one in five reported that they were engaged and thriving at work.

HRM recently joined Gallup’s CEO, Jon Clifton, and Rohit Kar, Regional Business Development Director for Australia, New Zealand and India, for an executive lunch to unpack the results further.

“There are millions of workers all over the world who are emotionally detached from work, and that largely isn’t improving,” says Clifton. 

“There is a rising detachment from many institutions. And I think one of the reasons that that’s taking place – this is true in America, and I think this is true in many OECD countries as well – is that there is a loss of trust in institutions, and that [can] create a great deal of apathy.”

This detachment is taking a heavy economic toll. The findings show that low engagement costs the global economy $US8.8 trillion each year, or nine per cent of global GDP. In Australia alone, the cost of low engagement is estimated at AU$211 billion annually. 

While this figure may be cause for concern, it also means that engagement strategies have enormous potential to drive growth and greater productivity.

Based on input from over 1000 Australian employees, Gallup’s report offers a number of insights on how organisations turn this challenge into an opportunity. Before we unpack those opportunities, let’s first explore some of the driving factors behind this billion-dollar problem.

What’s driving employee disengagement?

A key takeaway from Gallup’s report is a sharp upward trend in employees’ stress levels. Forty-eight per cent of Australian employees said they had experienced high levels of stress the previous day, exceeding the global average of 44 per cent.

The findings showed that the single biggest predictor of stress was whether or not people had the tools they needed to do their jobs effectively. Just 40 per cent of employees strongly agreed that this was the case.

“So many of the issues right now are basic management things,” says Clifton. “People are trying to get their work done, but they don’t have the basic things they need.”

“I think management fears those conversations because they think [employees] are going to say they need something new, something that’s very expensive. And that’s not necessarily always the case.”

He recalls working with a manufacturing organisation where employees were surveyed about what they needed to do their jobs more effectively. The standout request was not expensive tech or company cars; it was ‘gloves that fit’.

“This wasn’t a money problem, because they were already spending the money to buy gloves that don’t fit. So, from a psychosocial or physical safety perspective, the barrier here was listening. Nobody took an interest in whether or not the gloves fit. It [would have been] really easy, because all you’d do is walk down to the floor and go, ‘How are things going?’”

“We haven’t adjusted the very practices of management at the speed at which technology is moving.” – Jon Clifton, CEO, Gallup.

This disinclination to listen means employers are too quick to jump to conclusions about what will improve engagement and alleviate stress. For instance, some organisations are rolling back remote work and issuing return-to-office mandates in the hopes that proximity will equal productivity. However, Gallup’s findings show that overall engagement has almost four times as much influence on employee stress as work location.

During the research, Gallup asked disengaged employees what they would change about their workplaces to improve engagement and company culture. 

Some responses included: 

• For everyone to get recognised for their contributions
• Clearer goals and stronger guidance
• Giving everyone a fair chance in getting promoted
• I would like it if the managers were more approachable, and we could talk openly.
• I’d like to learn more things, but the work I do is quite repetitive.
• They should grant more autonomy in the work to stimulate everyone’s creativity.
• I just wish they respected me more.

Although employees’ needs and wants will vary significantly depending on the organisation in question, Clifton says the majority of these issues can and should be addressed through listening and changing management behaviours.

Gallup’s research suggests the most significant driver of low engagement is the quality of management. The report identifies management as the ‘linchpin of engagement,’ attributing 70 per cent of team engagement to the manager’s influence.

This means that manager development should be at the centre of every organisation’s engagement strategy.

Employees who are passively disengaged are the low-hanging fruit for productivity gains, says Clifton, as this cohort has the most potential to be inspired and re-invigorated if changes are made to the way they are managed.

An engagement strategy fit for 2023 and beyond

As leaders consider how best to empower managers to drive engagement, it’s crucial to consider the context of today’s hybrid world of work.

“So much now is moved to asynchronous forms of communication,” says Clifton. “And nothing’s wrong [with collaboration platforms] – these communication [tools] are amazing, and have helped empower and advance society in tremendous ways. But we haven’t adjusted the very practices of management at the speed at which technology is moving.”

According to Kar, the difficulties associated with remote work and asynchronous communication are especially present for younger employees.

“The newer generation is still building that relationship with companies,” he says. “They’re [trying to] build a relationship with their jobs and their work. When they start off remotely and continue working remotely, it changes the possibilities of what they can do.”

To help younger workers build these relationships, he suggests reframing the way that employees view the time they spend working on-site.

“It’s not just about the quantity, it’s also about the quality,” says Kar. “It’s not [about] your company promising that if you come to the office three days a week, you’ll get pizzas and you’ll go scavenger hunting, or whatever. It’s a promise you make to each other. How do you respect what you’re spending time together on, and the value of that time together in terms of the relationships and the outcome it creates?”

It might also be necessary to reframe the way that managerial relationships are perceived. Employees’ desire for greater recognition, guidance and career development means a traditional ‘command-and-control’ managerial style is unlikely to nurture engagement.

Instead, Kar suggests managers see themselves as coaches, who value employees as individuals and help them understand and build their strengths.

“If you have a manager who is encouraging you, giving you ideas, shaping the way you’re building your career, then, suddenly – if you were sitting on the fence with respect to the organisation – you’ll start leaning in,” he says.

“When you have that chance to lean in, when you have the right environment to lean in, it creates magic. It helps you see what you are capable of, and what you can do for your organisation.”

Big bank bosses in Canberra to meet Treasurer Jim Chalmers have declared a “soft landing” for the economy is becoming more likely and there will be “no recession”.

Westpac chief executive Peter King said on Wednesday most households and businesses are coping with the 4 percentage points of interest rate rises by the Reserve Bank, despite some strains.

The signal from the RBA that it may be done raising rates was giving business more certainty about borrowing costs for future investment plans and renewing interest in merger and acquisition activity, Mr King said.

Spending on Westpac debit and credit cards had edged higher in the past couple of weeks, suggesting consumers were generally coping with rate rises and cost-of-living pressures.

“At the macro level, things are a bit softish, but a soft landing is looking quite plausible,” Mr King told The Australian Financial Review at Parliament House.

“The key will be employment and people having jobs.”

National Australia Bank chief Ross McEwan said, although the economy was slow at the moment, the bank believed it would pick up and there was no prospect of recession.

“Yes, it has quietened down, but we still think there will be growth in the economy by December,” he said.

Due to the effects of immigration, increased housing investment and durable terms of trade, Mr McEwan predicted annual growth by December to be between 0.75 per cent and 1 per cent and be the same for the next year.

“We just don’t see that there will be a recession in Australia. It’s just quiet at the moment.”

However, Mr McEwan did join the calls to lift productivity, saying that was the only sustainable way to grow wages.

“We need a lot more productivity,” he said.

The bank bosses’ comments mirror quiet optimism inside the federal Treasury that a soft landing for the economy is looking more realistic than a few months ago, despite ongoing risks posed by high interest rates and China’s economic slowdown.

The gradual decline in US annual inflation, to 3.2 per cent in July, without a serious economic downturn has given local economic policymakers hope that a soft landing can be achieved in Australia.

Departing RBA governor Philip Lowe has repeatedly talked about the “narrow path” to a soft economic landing and some economists have warned that a hard downturn will be required to reduce inflation to the 2 per cent to 3 per cent target band.

Locally, gross domestic product expanded by a below-par 0.4 per cent in the June quarter, slicing annual growth to 2.1 per cent from 2.4 per cent.

However, much of the growth in the quarter was driven by a surge in inbound tourists and foreign students.

Household spending grew by just 0.1 per cent in the three months to June, as bracket creep fuelled strong growth in income tax payable while mortgage interest repayments soared, heaping pressure on family budgets.

GDP per capita, a common proxy for living standards, fell 0.3 per cent as the population grew faster than the economy as a whole.

Outside the pandemic, it was the first time since 2006 the measure has fallen for two consecutive quarters, known as a “per capita recession”.

Senior bankers are in Canberra on Wednesday and Thursday for meetings with Dr Chalmers and cyber and intelligence agencies, including discussions on the state of the economy, financial scams, cybersecurity and burgeoning financial sector red tape.

Westpac’s Mr King said most of the bank’s customers were managing financially with the rate rises and cost-of-living pressures, despite the obvious pressures facing some households.

Mortgage arrears had ticked up a bit but were still very low by historical standards, although arrears were likely to rise a little more in the months ahead, he said.

Consumers were paying off their credit cards and, unlike previous economic downturns, there had not been a spike in consumers falling behind on their credit card repayments, he said.

Mr King said some heat was coming out of the labour market and employees were now valuing job security more.

In his final RBA board meeting statement last week, Dr Lowe said: “Some further tightening of monetary policy may be required to ensure that inflation returns to target in a reasonable timeframe, but that will continue to depend upon the data and the evolving assessment of risks.

“In making its decisions, the board will continue to pay close attention to developments in the global economy, trends in household spending, and the outlook for inflation and the labour market.

“The board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that.”

ANZ-Roy Morgan Consumer Confidence was up 2.2pts to 79.8 this week as inflation expectations continue on a downward trajectory.

ANZ economist Madeline Dunk said consumer confidence is now at its highest level since late April.

“While the series remains at very low levels, particularly for those paying off a mortgage, there are some early signs of tempered optimism amongst households,” Dunk said. “Confidence for mortgage holders rose 4.1pts to record its highest reading in more than seven months.

“Meanwhile confidence increased 4.7pts for renters, after a sharp fall the week beforehand, but declined 2.3pts among those who own their home outright.”

Alongside the lift in confidence, Dunk said inflation expectations fell to 4.9% in mid-September, calling it the lowest reading since February 2022 before Russia invaded Ukraine.

The drop to 4.9% in mid-September is down from 5.4% recorded in August 2023, and down from 5.6% recorded in July.

Expected inflation scores cover annually over the next two years.

Consumer Confidence is now 6.2pts below the same week a year ago and is 1.6 pts above the 2023 weekly average of 78.2.

ANZ and Roy Morgan claimed a lift in confidence about personal financial situations over the next year drove the increase this week.

Now a fifth of Australians (20% - down 1ppt) say their families are ‘better off’ financially than this time last year compared to 52% (down 3ppts) that say their families are ‘worse off’ financially.

Looking forward, 33% (up 3ppts) expect their family to be ‘better off’ financially this time next year while 33% (unchanged) expect to be ‘worse off’.

8% (up 1ppt) of Australians expect ‘good times’ for the Australian economy over the next twelve months compared to 34% (down 2ppts) that expect ‘bad times’.

There was also a 4 percentage point drop in Australians expecting ‘bad times’ for the economy over the next five years to 19% compared to now 10% (down 1ppt) of Australians expecting ‘good times’.

This comes as the RBA held interest rates in early September at 4.1% for the third straight month.

Roy Morgan noted the softening in inflation expectations in recent weeks suggest the RBA’s decision to leave interest rates unchanged during their last three meetings may be the correct decision, but added there are still significant pressures in the economy.

This includes the average petrol price in Australia increasing to $2.04 per litre.

Roy Morgan CEO Michele Levine said the RBA has taken stock of the evolving economic situation in Australia, leading to the drop in inflation expectations.

“Although the drop in Inflation Expectations during August and September is good news, there are signs that it may prove to be short-lived,” Levine said. “So far in September the Australian Dollar has hovered consistently below 65 US cents – including hitting a low of only 63.6 US cents.

“The immediate impact of the low Australian Dollar is being felt at the pump with average retail petrol prices averaging $2.04 per litre last week and above $2 per litre for the last five weeks.

“This is the first time since July 2022 petrol prices have been at a sustained high level above $2 per litre for more than a month.”

Levine said petrol prices are one of the most visible signs of inflation.

“If they continue to remain at an elevated level above $2 per litre, or even rise further in the weeks and months ahead, this will clearly increase the general inflationary pressures in the economy.”

Levine said that if these inflationary pressures in the economy continue to grow, there will be renewed pressure on the RBA to increase interest rates again.

“The next RBA meeting on interest rates will be new Governor Michele Bullock’s first in the top job,” Levine said.

“Although all the current signs are that the RBA is set to leave interest rates unchanged, as ANZ economists Adam Boyton and Blair Chapman noted in a research note today: the RBA opted for a ‘hawkish pause’ in September as they continued to ‘monitor incoming data and how these alter the economic outlook and assessment of risks.’”

Reserve Bank governor Philip Lowe is all but certain to hold rates at his final board meeting on Tuesday, after inflation dropped to 4.9 per cent in the year to July, from 5.4 per cent in June.

While consumer price growth remains too high, it has declined steadily since hitting a peak of 8.4 per cent in the year to December, based on the monthly numbers, and an increasing number of economists believes the RBA may have done enough to bring inflation under control without the need for further hikes.

Petrol prices remain high and climbed further in August, but in July they were down by 7.6 per cent against the peaks of last year, and this dragged on the overall inflation result, as did a 5.4 per cent annual drop in fruit and vegetables prices thanks to a bumper growing season, the Australian Bureau of Statistics said.

The puff also came out of holiday travel and accommodation inflation, which more than halved to 5.3 per cent in the year to July, from 13 per cent the month before.

KPMG chief economist Brendan Rynne said there was “nothing in today’s figures to lead the RBA to increase rates next week” from their level of 4.1 per cent.

After a dozen rate rises since May 2022 sent mortgage interest burdens to record highs, EY senior economist Paula Gadsby said further hikes looked “increasingly unnecessary”.

“This cooling is further evidence that rate hikes are working, and the Reserve Bank will be pleased with its piloting of the economy towards a soft landing. Whether … that soft landing is ­accomplished remains to be seen,” Ms Gadsby said.

The cost of living pressures crushing household budgets around the country persisted.

Rental inflation accelerated from 7.3 per cent in June to 7.6 per cent in July, the data showed.

Electricity bills on an annual basis were up nearly 16 per cent, up from 10 per cent in the year to June, even as government energy bill rebates worth up to $250 began to flow to eligible households.

ABS head of prices statistics Michelle Marquardt said the power bill shock would have been much worse had it not been for the taxpayer support. “If we exclude the impact of rebates from the July 2023 figures, electricity prices would have recorded a monthly increase of 19.2 per cent,” rather than the month-on-month rise of 6 per cent, Ms Marquardt said.

Jim Chalmers in a statement said the inflation numbers were “an encouraging result, but we know Australians are still under the pump”.

“It’s pleasing to see inflation is moderating but we know it will remain higher than we’d like for longer than we’d like,” the Treasurer said.

“This data makes it very clear our energy price relief plan is working as intended by helping to take some of the sting out of power price rises when people need it most.”

Despite the decline in fruit and vegetables prices, grocery bills remained much higher than a year earlier. Dairy prices were up almost 13 per cent (cheese was 19 per cent higher), while bread and cereals prices were 10 per cent higher.

Other food products climbed 8.3 per cent annually, although prices declined slightly in the month, and meat and seafoods inflation over the year was more subdued, at 2.4 per cent, as lamb and beef prices declined versus a year earlier.

Excluding the more volatile items of petrol, fruit and vege­tables and travel, the price data showed a more modest fall in “underlying” inflation, from 6.1 per cent to 5.8 per cent, the ABS said.

Deputy governor Michele Bullock on Tuesday evening said she was “reluctant” to say how long interest rates would need to stay high.

“All I can say is that we may have to raise interest rates again, but we’re watching the data very carefully,” Ms Bullock said.

In today’s dynamic economic landscape, the persistent issue of skills shortage has emerged as a pressing concern, reverberating across all industries in Australia. As businesses strive to meet the demands of rapidly growing population, the scarcity of skilled workers remains a challenge.

Population data plays a crucial role in understanding the intricate demographic dynamics that shape both the present and future of our workforce. Through the examination of various population groups, potential strategies can be explored to navigate this challenge, seeking effective means to bridge the disparity between the supply and demand of skills.

For an overview of the existing business landscape, the ABS Characteristics of Australian Businesses data proves invaluable. This dataset, based on surveys and released in June 2023, offers insights into business performance, financial status, market trends, and skill scenarios.

In the year ending June 2022, ABS recorded about 2,569,900 operational businesses. Almost a million (38 per cent) businesses indicated a shortage of skilled personnel. This figure is notably higher compared to the 24 per cent of businesses that reported a skills shortage in the year ending June 2020.

Shortages were most prevalent in the fields of trades, labour, care/support, hospitality, nursing, medical domains, engineering, cleaning, and driving.

The accommodation and food services sector exhibited the most pronounced skills shortage, with about 56 per cent of businesses acknowledging a deficit in skilled staff. Following closely was the arts and recreation services industry at 47 per cent, and the retail trade industry at 45 per cent.

Conversely, industries facing the least severe shortages included transport, postal, and warehousing, registering a 27 per cent shortage, followed by the rental, hiring, and real estate services sector at 30 per cent.

The survey also documents the strategies implemented by businesses to address this predicament. About 41 per cent of enterprises indicated raising wages/salaries and enhancing employment conditions as a means to attract workers. Moreover, about 9 per cent of businesses extended working hours, while 37 per cent amplified their utilisation of on-the-job internal training.

Additionally, about one in four businesses embraced new recruitment approaches and opted for subcontracting or outsourcing. Despite these efforts, attracting talent remains a formidable challenge.

The population data doesn’t offer much reassurance, as it signals that the challenge of skill shortages will persist in the decades ahead. According to the Australian Bureau of Statistics (ABS), the population of Australia was estimated to be about 26.2 million in 2022, with approximately 65 per cent falling into the working age (15-64) bracket. This figure has declined by 2 percentage points over the past decade and is projected to drop further to 64 per cent by 2032.

The Centre for Population anticipates a modest 3 per cent growth in the younger population (aged 0-14) between 2022 and 2032. During the same period, the working-age population is expected to experience a growth of 12 per cent, while the older population (aged 65 and above) is set to surge by a substantial 31 per cent. The implications of an ageing population are multifaceted. Firstly, the reduced tax base could lead to a decrease in government revenue, impacting the funding of essential public services. Pension systems are also likely to face challenges, given the increased number of retirees relying on pension funds.

The considerable growth in the elderly population will necessitate a proportional expansion of the workforce dedicated to healthcare, social services, and age-related sectors.

The Care Workforce Labour Market study conducted by the National Skills Commission and published in September 2021 unveiled that all roles within the care and support workforce were anticipated to experience either strong or at least moderate demand. Notably, the demand for workers in the residential aged care sector was predicted to grow by about 3.2 per cent annually over the next three decades.

Catering to the needs of the ageing population will also call for substantial infrastructure enhancements. This encompasses accessible housing, improved healthcare facilities, transportation options tailored to seniors, and age-friendly urban planning which includes community spaces to encourage social interaction and physical activity. The realisation of these infrastructure projects will rely significantly on the construction and property industry for extensive support which will in turn require a considerable labour supply.

Then, there’s the phenomenon known as the “baby bust” which started in 2011. This marked the inaugural year when Baby Boomers (born between 1946 and 1963) started reaching their customary retirement age of 65. The concept of a baby bust arises due to a larger number of workers leaving the workforce at the age of 65 in comparison to the influx of workers entering at the age of 15.

The baby bust decelerates the rate of growth of workforce. Efforts such as increasing the intake of highly skilled migrants were implemented to alleviate this situation. Nevertheless, the pandemic played a pivotal role in exacerbating the shortage of workers even further.

Prior to the pandemic, the Australian Bureau of Statistics (ABS) projected the population to reach 30.6 million by 2032. However, in 2023, the Centre for Population revised these estimates downward to 29.6 million. The adjustments in population estimates highlight the challenge of recruiting early career professionals, which is expected to be even more difficult than initially anticipated.

Every age group within the range of 0 to 19 has experienced a reduction in the post-pandemic projections.

This decline constitutes about 69 per cent of the total population loss in the adjusted estimates. Similarly, every age group between 25 and 52 has also encountered a decrease in these projections, while the older population remains unaffected by these revisions.

This proves that hiring and retaining workers will be a major issue. To effectively tackle these challenges, organisations should take a proactive approach by identifying which areas are likely to be impacted the most and devising strategies to address these skill shortages.

This could entail initiatives such as upskilling current employees, exploring diverse talent pools, and establishing partnerships with educational institutions to foster a skilled workforce most of which are already being practised by #businesses as indicated in the ABS survey data.

Furthermore, the need for a well-defined staffing strategy cannot be overstated.

This involves pinpointing the specific roles that are most susceptible to shortages and actively planning for recruitment and succession. Such a strategy ensures that the organisation remains prepared to swiftly fill critical positions, mitigating disruptions to its operations.

Given the scarcity of skilled personnel, harnessing technology becomes even more vital. The integration of AI and automation solutions can optimise workflows, streamline processes, and alleviate the burden on human resources.

By automating routine tasks and enhancing back-office efficiency, organisations can liberate their workforce to be used in sectors which face acute shortages such as healthcare and construction industries.

The enduring issue of skills shortage poses a continuous and widespread challenge for various industries. Population data serves to emphasise the enormity of this obstacle.

Through the examination of region-specific data, we can identify areas where this challenge will be particularly pronounced. This enables local governments and businesses to tailor strategies to address the issue effectively. In the immediate future, the adoption of proactive measures such as upskilling, expanding talent pools, and harnessing technological advancements presents feasible solutions to tackle this challenge head-on.

As the business world continues to move on from Covid-19, a range of trends and assumptions widespread during the height of the pandemic are being reassessed. Among them is the notion that "job-hopping" by younger workers is natural or even laudable.

Of course, job-hopping, especially by younger workers, isn't new. Gallup called millennials the "job-hopping generation" back in 2016, and data suggest that job-hopping overall has been in decline since 2001. But the ultra-tight labor market of the past few years and other factors have put the phenomenon in the headlines again, especially with quiet quitting and demands from workers for remote work options.

That has made it top-of-mind for those responsible for staffing up businesses large and small. And those involved in filling roles tend to be much less forgiving of the habit than younger job hunters might think or hope.

Whenever the issue of job-hopping comes up, it is important to first acknowledge that employees are often not responsible for a CV that reflects a lot of movement. There are layoffs and bosses or colleagues who turn out to be overbearing or sexist — and even whole workplaces that are toxic. And there are a lot of other things that happen in life that are outside of one's control and which can force someone to change jobs with a greater frequency than planned.

No one should ever be shamed for leaving a job that is unhealthy or for a job that disappears for reasons having nothing to do with one's performance. And of course, people sometimes leave jobs for personal reasons that are even more important and rewarding than work, like starting or growing a family or caring for a loved one.

The downsides of job-hopping

By contrast, job-hopping is more about short-term gain and short-sighted behavior. It's people leaving not because they are being mistreated or hitting a glass ceiling, but for a few thousand more in annual salary or a commute that's a few minutes less. It's sometimes about people becoming bored with the job they currently have. And when people start switching jobs because of the lure of a "shiny new object" or just because they feel like leaving, it can quickly become a pattern.

One of the most corrosive aspects of job-hopping is that the damage it causes to careers usually isn't obvious to the workers themselves. Candidates who are otherwise well-qualified for a position will be moved to the bottom of the pile by hiring managers who have been burnt in the past and don't want to take a chance of it happening again. And in some cases, they won't even get into the pile, screened out by software designed to pinpoint CVs with excess movement between jobs. But as a job-seeker, you won't even be aware of opportunities you may be missing, because people just don't contact you — all you get is silence.

There is no official line beyond which the normal cycling of positions turns into job-hopping, and for the youngest of workers, it's hard even for seasoned HR professionals to get a read. Two jobs in someone's first two years out of college might not mean anything. But if someone has been in a career for several years, the signs can be all too obvious. Five jobs in eight years? You could have trouble getting the sixth. Fifteen jobs in 20 years? You may be unemployable.

For younger workers, a good rule of thumb is that anything less than a two-year commitment to a particular job can be troubling. And more than two or three jobs cut short is likely to have a meaningful negative impact on your prospects.

One interesting aspect of the current narrative around job-hopping is the notion that employers have no loyalty to their workers and that this lack of loyalty is something employees, especially younger workers, should repay. But job-hopping most conspicuously demonstrates a lack of regard for colleagues. This might not matter greatly if one is content to be a contractor or to be treated as one. But it doesn't work if someone is hoping to be valued as a full member of a team and treated loyally by their employer.

There are other good reasons to resist the lure of job-hopping. Many positions become more rewarding over time, especially as they become more challenging. It is natural to assume that advancement in pay and title should come before an increase in responsibilities. But it is even more natural for successful organizations to give promising employees more responsibilities before they are officially promoted. In business life, it is often easy to forget that the best opportunities can be found by looking up, rather than out.

Markets have raised bets that outgoing Reserve Bank governor Philip Lowe will increase interest rates after the jobless rate in Australia’s most populous state fell to 2.9 per cent, entrenching unemployment at a level Treasury and the central bank say is inflationary.

About 32,600 people found work in June, the latest Australian Bureau of Statistics data shows, countering economists’ expectations for modest employment growth of 15,000.

The gains helped the jobless rate hold steady at a downwardly revised 3.5 per cent, keeping the national unemployment rate within the narrow 3.4 per cent to 3.7 per cent range it has hovered in since June last year.

Evidence of persistent labour market tightness prompted traders to revise higher their estimate of the RBA’s peak cash rate to 4.5 per cent from 4.4 per cent.

Markets ascribe a 56 per cent chance the central bank will increase the cash rate to 4.35 per cent from 4.1 per cent at its meeting on August 1, up from 36 per cent before the release of the jobs figures. They are fully priced for a 0.25 percentage point increase by RBA deputy governor Michele Bullock’s first meeting as RBA governor on October 3.

Successive months of strong jobs growth pushed the unemployment rates in NSW and Tasmania to their lowest levels on record at 2.9 per cent and 3.5 per cent, respectively.

Ms Bullock said last month a 4.5 per cent unemployment rate was necessary to engineer a return to the RBA’s 2 to 3 per cent inflation target.

As unions push the RBA to maintain unemployment at levels the central bank views as unsustainable, Employment Minister Tony Burke would not be drawn into the debate on Thursday.

He neither backed union claims nor shared the RBA’s concerns about the inflationary effects of the tight of the jobs market.

“When someone gets a job, we see that as a success,” Mr Burke said.

Economists say the June-quarter consumer price index, due on July 26, will be the main factor determining whether the RBA increases the cash rate to 4.35 per cent on August 1.

NAB expects headline inflation to fall to 6.1 per cent in the June quarter, but its economist Taylor Nugent said that would not signal an end to rate rises.

“Overall, while we do not expect the June-quarter outcome to sharply surprise the RBA’s May forecast, we do think that the detail will be indicative of some persistence in inflation pressures that the RBA has been citing as a risk,” Mr Nugent said.

The Australian Council of Trade Unions is pushing Labor to redefine full employment as “zero involuntary unemployment” in the federal government’s updated Statement on the Conduct of Monetary Policy, due to be signed with the RBA later this year.

The change, if adopted, would alter the RBA’s existing approach to monetary policymaking, given the bank uses as its main gauge of full employment the non-accelerating inflation rate of unemployment (NAIRU).

The RBA estimates the NAIRU, which is the unemployment rate at which inflation is neither rising nor falling, to be in the “low 4s”, meaning the central bank views the current 3.5 per cent unemployment rate as unsustainably low.

Full-time increase

Although high interest rates have forced households to cut discretionary purchases, the slowdown in spending is yet to spill over into the jobs market, which is tighter than at any point in almost 50 years.

June’s employment gains were driven by a 39,300 increase in full-time workers, which was only partly offset by a 6700 fall in part-time employment.

The outcome took employment growth in the June quarter to 0.9 per cent and annual employment growth to 3 per cent, which was higher than the 2.5 per cent projection in the RBA’s May economic forecasts.

Employment gains of at least 31,000 are needed each month to stop unemployment from ticking higher based on the current rates of population growth, assuming the participation rate stays unchanged.

The RBA expects the jobless rate to break its holding pattern and drift higher to 4.5 per cent by mid-2025 due to the dampening effect of 12 interest rate rises.

While the jobs numbers will keep pressure on the RBA to lift interest rates, BetaShares chief economist David Bassanese said the June-quarter CPI would be the main driver of the central bank’s decision.

The central bank’s May forecasts show it expects headline inflation to fall to 6.3 per cent in June from 7 per cent in March.

Mr Bassanese said the softer-than-expected monthly CPI indicator for May, which showed a sharp decline in headline inflation to 5.6 per cent, meant there was a possibility the June-quarter CPI could show inflation had fallen below 6 per cent.

“If the quarterly CPI confirms the pleasing drop in headline and core inflation contained in the May monthly CPI report, there’s still a good chance the RBA will refrain from raising rates again in August,” he said.

But that view is not shared universally. NAB’s Mr Nugent said he expects core market services inflation to show no moderation, running at similar rates to late last year and annualising above 6 per cent.

That persistence means the RBA will probably revise its underlying inflation outlook higher in its August forecasts, Mr Nugent said.

“A further tightening in policy therefore will be needed to have greater confidence in getting inflation back to 3 per cent by mid-2025, and NAB continues to expect the RBA will raise the cash rate in August and to 4.6 per cent over coming months.”

Oxford Economics Australia head of macroeconomic forecasting Sean Langcake said the jobs market looked strong across the board, with participation near record highs and unemployment close to a five-decade low.

“This is unambiguously good. However, the strength of the labour market will continue to keep upward pressure on wages and inflation,” Mr Langcake said.

Almost 95 per cent of the employment gains over the past three years were in full-time work. About 70 per cent of workers in June were employed full-time, the highest level in a decade.

The participation rate – the percentage of working-age people in the labour force – edged lower to 66.8 per cent, just shy of the record 66.9 per cent level hit in May.

Hours worked across the economy increased 0.3 per cent, taking the growth in hours over the past 12 months to 4.7 per cent as employees put in more time at work.

Low unemployment has driven nominal wages growth to a decade high. Data released in May showed salaries increased 3.7 per cent in the year to March, while pay rises for workers on enterprise bargaining agreements recorded their biggest jump in 11 years in the March quarter.

However, economists do not expect current levels of labour market tightness to persist, and leading indicators point to higher unemployment.

This includes household expectations of unemployment, which have increased 32 per cent since May last year, and job vacancies, which have fallen 10 per cent since their peak, according to data from the ABS.

ANZ chief economist Adam Boyton said there were signs the labour market was starting to cool.

“The underemployment rate is up 0.6 percentage points from its low, while NAB’s June-quarter business survey showed the proportion of businesses reporting labour as a constraint on their output declining slightly from 86.5 per cent to 82.8 per cent,” Mr Boyton said.

“The slowdown in economic activity suggests employment growth and growth in hours work should cool materially over coming months.”

Harry Styles and Ed Sheeran concert-goers and even hyped-up Australian Open fans have defied inflation and high interest rates, boosting the economy and clouding the Reserve Bank’s plans for monetary policy.

A string of major sporting and cultural events across the country have buoyed spending by consumers even as they look to wind back their expenditure in the face of the RBA’s aggressive increases in interest rates.

Retail sales, as measured by the Australian Bureau of Statistics, have slowed through the start of this year despite strong population growth. In April, the ABS reported sales for the month were flat while the annual rate of growth slipped to its slowest pace since late 2021.

But the bureau noted that while overall sales were slowing, the pace of spending through cafes, restaurants and takeaways was up 13.3 per cent over the past 12 months.

“Spending has also been boosted by the return of large-scale sporting and cultural events,” ABS head of retail statistics Ben Dorber said.

Those cultural and sporting events, many of them either delayed or pared back because of COVID-related restrictions, are now delivering measurable boosts to the economy.

According to the bureau, musicians such as Styles, Sheeran, Elton John and the Red Hot Chili Peppers have not only entertained hundreds of thousands of people but enticed them to open their wallets.

Styles attracted more than 100,000 people to his two concerts at Marvel Stadium in Melbourne in February. Many concert-goers ate at nearby restaurants and also paid up to $120 for a Styles sweatshirt.

In March, Sheeran entertained 217,500 people at two separate concerts at the MCG – the first events at the MCG with more than 101,000 people since the then-VFL grand final of 1986.

Both the AFL and the NRL have also affected the nation’s spending patterns.

The introduction of the Dolphins to the rugby league competition brought forward the start of the NRL season, boosting economic activity in March.

The AFL started its season with back-to-back matches at the MCG which attracted more than 86,000 fans. Through the first 11 matches of the season, more than 3.6 million people have watched games live, 61,500 more than the previous record set in 2019.

A key element has been the strong start to the season by Collingwood, which has attracted an average 70,000 fans to the Magpies’ five MCG games.

The AFL’s first Gather Round, held in Adelaide in April before a combined 268,000 fans, boosted economic activity in that city. Analysis by NAB found a 50 per cent jump in accommodation expenditure through that weekend.

Adelaide also benefited from the first LIV Golf tournament, which attracted more than 60,000 spectators to The Grange golf club.

This year’s Australian Open in Melbourne set a new two-week attendance record with almost 840,000 people through the gates. The previous record of 812,174 was set in 2020, just ahead of the COVID outbreak.

Even in the nation’s smaller jurisdictions, the end of COVID restrictions has given cultural events a boost. Canberra’s national multicultural festival in February attracted a record crowd of 380,500 over a weekend.

In NSW and Victoria, spending in discretionary areas such as footwear and household goods is down on a year ago, but spending at cafes and restaurants in both states is up by more than 20 per cent on March 2022.

ANZ’s head of Australian economics, Adam Boyton, said despite consternation about the pressures facing consumers amid a period of higher interest rates, they had proven to be highly resilient.

He said the strong jobs market was continuing to deliver the income necessary for consumers to weather higher costs.

“If the household sector is in solid shape, then weakness in consumption this year could reflect discretionary spending coming back to more normal levels, not a ‘forced’ across-the-board retrenchment,” Boyton said.

ANZ-Roy Morgan Consumer Confidence is down 1.1pts to 76.2 this week and has now spent thirteen straight weeks below the mark of 80.

This is the longest stretch below 80 since the index began being conducted on a weekly basis in October 2008.

The last time consumer confidence spent at least thirteen weeks under 80 was during the 1990-91 recession when the index was conducted on a monthly basis.

Consumer confidence is now 14.5pts below the same week a year ago - May 23-29, 2022 (90.7) - and 3.8pts below the 2023 weekly average of 80.

Looking around the States, consumer confidence reversed last week’s results and was down in Victoria, Queensland, WA and SA but up in NSW.

The driver of this week’s decrease was reduced confidence about personal financial situations compared to a year ago, Roy Morgan and ANZ reported, while other indicators were largely unchanged compared to a week ago.

Now 18% of Australians (unchanged) say their families are ‘better off’ financially than this time last year compared to 53% (up 4ppts) that say their families are ‘worse off’ financially.

Looking forward, 29% (down 1ppt) expect their family to be ‘better off’ financially this time next year while over a third (35% -down 1ppt) expect to be ‘worse off’.

Only 7% (down 1ppt) of Australians expect ‘good times’ for the Australian economy over the next twelve months compared to 40% (up 1ppt) that expect ‘bad times’.

Looking further ahead, only 11% (unchanged) of Australians expect ‘good times’ for the economy over the next five years compared to 21% (unchanged) expecting ‘bad times’.

When it comes to buying intentions, 19% (up 2ppts) of Australians say now is a ‘good time to buy’ major household items while over half (54% - up 1ppt) say now is a ‘bad time to buy’.

ANZ senior economist Adelaide Timbrell said the average confidence for May 2023 (76.8) was the weakest calendar-month average since December 1990.

“The weekly result was the fifth worst since January 2020 and represented the 13th consecutive week below 80,” Timbrell said. “Confidence about current financial conditions fell the most during the week and was at its second-weakest point since the beginning of 2020 (first-weakest being earlier in May 2023).

“Those paying off their homes still have far lower average confidence than renters and outright owners, despite housing prices lifting since mid-February.”