Employment experts say many different types of jobs are being lost forever during this pandemic as companies accelerate restructuring that was happening before the crisis began.
- A survey shows financial services, consulting and administrative staff are now most worried about losing their jobs
- Middle-level managers in particular appear to be facing redundancy
- Some economists say the removal of a layer of management could boost productivity by encouraging more staff autonomy
When marketing manager Wendy Robertson’s boss took her aside, she knew what he was about to say.
“I could see the viability of the business wasn’t going to be sustainable,” she told PM.
“For him it was pretty tough; he probably struggled more than me.”
Ms Robertson’s management position was made redundant.
She has been forced into contracting, something she never dreamed she would need to do.
“I wouldn’t have resigned from a permanent role to go and be a contractor, because that just seems bonkers, but circumstance put me in this position,” she said.
Middle-level managers face the chop
Ms Robertson joins a wave of middle-level managers losing their jobs, according to independent banking and household finances analyst Martin North.
He uses a telephone survey, which engages 1,000 people, to find out what is worrying households.
In his latest survey, he has been able to track which industries are most affected.
“Now we’re seeing structural unemployment,” he said
“And it seems to be honing in on middle-level management roles in particular.
“It’s essentially the collapsing of the layers within the large organisations that seems to be going on here.”
Recruitment firm Drake International told PM it has just been hired by a major Australian telecommunications company to fill 12 contract roles that were previously permanent positions.
Drake chief executive Christopher Ouizeman described it as a “major shift” in the employment landscape.
“You know organisations can avail themselves of high-end technical specialists for defined periods of time for a fraction of the cost of putting someone on a permanent payroll,” he said.
“The bottom line is companies are frightened but it doesn’t stop them from wanting to progress, and contracting is an elegant solution to that problem.”
Working from home, he said, is accelerating a process of cost cutting, downsizing and restructuring that began years ago to counter broader weakness in the economy.
“So the mindset is, if we start to structure our business differently, do we really need to undertake the legacy activities of the past, and a lot of organisations have come to the conclusion that no they don’t,” he said.
“So we’re seeing a lot of companies restructuring.”
Value of managers under spotlight
Alison Pennington, a senior economist with the Centre for Future Work, said working from home during the pandemic has opened top-level managers’ eyes to the value of providing lower-level staff with more independence.
“We should question the relative value-add of someone whose job it is to oversee others,” she argued.
“Australia’s professional services industries have been internationally recognised as having some of the worst workplace cultures, in particular because of the very top-down types of command and control that white-collar workplaces have been functioning under, and it’s actually proven to be bad for productivity.
Ms Robertson said many managers can no longer cling to a company for job security, but instead will have to learn to fend for themselves, as will many other workers.
“It’s not going to be about roles anymore, it’s going to be about skills, and mindsets,” she said.
“What are the skills and mindset we need to deliver the outcomes for the organisation? How do we get them?
“They may not all exist in one person.
“We might bring in three part-time contractors to work on a particular project to bring all the skills and the mindset we need.
“And the people that were in roles that have now been permanently displaced will have to figure out where they might fit in that environment.”
The Government said it was acutely aware that the economic fallout from COVID-19 would continue for some time, particularly in light of the outbreak of cases in Victoria.
“This is why the Government has moved quickly to protect both the health and jobs of all Australians and has put in place sustainable measures to help cushion the impact of the pandemic,” Minister for Housing and Assistant Treasurer Michael Sukkar told the ABC in a statement.
“The latest ABS data shows that while the professional services sector has not been immune to job losses, comparatively, the percentage of jobs lost in this sector has been less than the broader economy.”