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Australia’s employment paradox is clear: wages are rising, but productivity is falling. Employment Hero’s latest SmartMatch Employment Report reveals Sydney and Melbourne’s uneven wage trends, spelling broader economic challenges for SMEs.
Key findings include:
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Wages continue to rise: Sydney’s 6.6% wage growth vs. Melbourne’s 3.6%, though, hours worked have declined in both cities.
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Productivity drops sharply: Average hours worked fell by 6.0% YoY, with casual employees seeing a staggering 25.4% drop, suggesting businesses are preparing for a diluted holiday season.
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Flexibility in focus: Casual employment rose by 10.7% YoY, but hours worked per casual employee plummeted, indicating businesses are reducing individual workloads.
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Industry divergence: Construction & Trade Services led wage growth at 10.3% YoY, while Science & Technology showed resilience with 5.9% YoY growth in wages and a modest 0.6% decline in hours worked.
Ben Thompson, CEO and Chief Economist at Employment Hero, explains: “Our workforce is at a critical tipping point. Rising wages signal strength in our labor market, but the sharp decline in productivity is a red flag for Australia’s economic resilience.”
“This isn’t just about numbers – it’s a wake-up call for SMEs to rethink how they balance costs, flexibility, and efficiency. With Sydney and Melbourne reflecting very different realities, businesses must embrace innovative strategies to remain competitive. The holiday season will be pivotal, not just for revenue, but as a test for Australia’s workforce stability heading into 2025.”
See attached a PDF of the October report. Let me know if you’re interested in any of this data or would lik
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