Talent War - Shortage eases, contract workers rule in 2023

Ashley Regan
By Ashley Regan | 17 January 2023
Morgan Housel via Unsplash

Demand for permanent staff will be replaced by contract workers as a different type of talent war unfolds in 2023, according to recruiters.

Ahead of the MFA Industry Census, due to released to member agencies next month, AdNews can reveal that in September 2022 member agencies reported a vacancy rate of 8.5%, an improvement from 12% in 2021.

Linda Wong director of people at the Media Federation of Australia: “While there is still a talent shortage in Australian media agencies, it has eased somewhat over the past 12 months.

“Another noteworthy finding from the upcoming MFA Industry Census is that the industry population (i.e. the number of people employed by media agencies) increased yet again in 2022. 

“So we’ve been successful in attracting more talent already, and a key reason for the talent shortage is that our industry continues to grow."

Simon Hadfield executive partner at specialist marketing recruitment agency DMCG Global, said: “Overall things are feeling slightly better, however there remains a real lack of junior to mid weights. 

“The grassroots or grad programmes seem less prevalent and therefore we have a gap forming for the coming window of time. Investing in the kids from Uni is critical.

"Agency life seems to continue to be less and less desirable and overlaying this with more and more project work (vs retainer) only adds fuel to the fire. When other sectors like tech etc are also looking for great talent, it makes it difficult to attract up and comers."

While the specific pressures of the 2022 talent war seem to be cooling with more bums in seats, the economic headwinds of 2023 have surfaced the opposite anxiety - Will there will be fewer jobs to fill as staffing budgets tighten?

“With the economy looking a little fragile, agencies are thinking twice about hiring and trying to weather the (upcoming?) storm,” Hadfield said.

“This puts added pressure on existing employees but also takes the heat slightly out of finding folk.

With staff budgeting tightening those who took advantage of the lack of talent last year by either asking for extraordinary pay rises or accepting a higher position without the experience - will most likely be the ones management is looking at. 

Allen Smith, founder and chief innovation officer at DMCG Global, said: “I do feel a number of redundancies will be on the cards in 2023.

“As the market starts to retract and finance departments start to put a red line through the names of people who decided to stay for the large counter-offers as in many respects they were counters that were short-term fixes to have bodies in the role. 

​”I also believe we will reach a point where salaries and available talent will balance themselves out again.

“The media agency landscape has a massive talent shortage. From our interviews we are noticing far too many of the younger generation are seeing this as a very undesirable career and it is not an easy fix, as there are various moving parts that attribute to this."

Zena Nicolson practice manager at marketing recruitment agency Aquent said: “In agencies so many new hires were made and so many were promoted quickly in such a short 18 month period, that I expect positions will become steady and companies will have a larger focus on tightening salary budgets.

“As enterprises will streamline their staff by hiring less permanent staff - or none at all - businesses will have a higher demand for contract workers.”

From an agency perspective, the talent shortage could be exacerbated by Australians wanting to work overseas since international travel has eased.

Jen Davis head of people and culture at Essence MediaCom said: "Competition for talent is still an industry issue, but that has always been the case for media given our market size.

"It’s not new and whilst I don’t see that changing anytime soon, I do think the intensity will subside this year as we see the global talent markets open up and talent become more confident to travel and relocate. 


"With travel restrictions behind us we are seeing our junior talent wanting to go overseas and experience working in different markets. We are so supportive of this as part of helping our people shape a fulfilling career and I’m excited these opportunities are becoming available again."

Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au

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