Engineering & Technical Recruitment Market Commentary April 2013

The past quarter as a recruitment company operating in engineering and technical markets could best be described as “a grind”. There is a flow of roles which we’re able to present to our candidates but things certainly aren’t coming easy or in the same volumes as in recent times. The opportunities are also very sector (or even sub-sector) specific.

In a number of engineering disciplines there would appear to be an excess of supply of engineers over demand. As a consequence, according to the Engineers Australia Salary & Benefits Survey 2012, the average base salary package of professional engineers in Australia dropped by 3% between 2011 and 2012.

We’d prefer to be telling you a good news story however we feel it’s important to give an accurate picture of how we see the current market.

Automotive and Manufacturing

The manufacturing sector continues to be relatively quiet from a permanent recruitment perspective. Companies are showing a continued reluctance to hire permanent staff and once again are catering for additional work demands by hiring contract or on-hired employees.

With respect to permanent engineering recruitment, we have been busy recruiting for Manufacturing Managers, Project Managers, Internal and External Technical Support Staff, Senior Production Managers, Transport & Logistics Managers and Supply Chain Managers in the food, electrical componentry and machinery manufacturing areas.

Our labour hire division in Melbourne has been busy supplying staff for seasonal requirements in the manufacture of climate control products. In addition food manufacturing has been stable, with the prospect for increased demand in the next quarter. There has also been higher interest from clients in Warehousing/Logistics personnel. Demand in the electronics industry is still fairly slow; however we always welcome skilled candidates to apply for any industrial related positions.

Our Sydney labour hire team are experiencing a high level of enquiry, however most is for short term assignments. Manufacturing is generally slow in Sydney and the traditional demand for positions such as Boilermakers, Welders, CNC Machinists is lower than normal. On the other hand demand for positions such as Feld Service Technicians has increased. The waste industry has steady demand for positions such as Maintenance Fitters and Maintenance Supervisors and there is a continuing requirement for unskilled and semi-skilled labour for casual positions.

Candidates should continue to thoroughly prepare for interview, the general rule of thumb being, the better the preparation, the greater the possibility of success. Remember to use or join LinkedIn if you have not done so already.

Building Services

Tight State budgets and private sector pullbacks are still resulting in a shrinking construction labour workforce. Office vacancy rates are increasing, the carbon pricing mechanism is raising concern regarding the effect on building costs and business confidence is lower, so prospective construction clients appear to be reluctant to commit to taking on staff.

The Melbourne market is currently directly affected by budgetary tightening by the State Government and private sector that has little appetite for risk. Sydney appears to be no better off with clients reluctant to commit to new projects and Perth and Brisbane are seeing projects being put on ice. The only place in Australia that seems to have a positive outlook from a building services perspective is Darwin.

Whilst we are seeing a reduced number of employment opportunities in building services, there are still positions on our books to be filled, and we hope that these will grow as we move further into the year and past the uncertainty that a pending election always seems to bring.

Consulting Engineering

During the last quarter we have not seen any increase in the hire of permanent or contract personnel for the large engineering consultancies. The small to medium engineering consultancies are still hiring in patches but this is due to working in the retail & commercial development area with a long established client base. We’re also hearing that larger consultancies are bidding for work which has previously been the domain of the mid-sized consultancies. Most Australian markets are still very quiet and we are facing a market with limited jobs and an abundance of experienced engineers. This is ultimately driving down rates for experienced engineers. This trend is being accentuated as engineers from WA and QLD come onto the market as work in their states slow.

Drafting

In Victoria there has been some up-turn in contract drafting requirements but nothing that would suggest that there has been a major turnaround.

We are noticing an increasing need form clients for short term contracts, say two to three days per week for a month or two. Also clients are increasingly requesting that contractors provide their own computers and licensed software – not always an easy option. Sought-after CAD skills continue to be AutoCad, SolidWorks and to some extent Inventor. Industries being served include light engineering (sheetmetal), agricultural and rail.

Overall things are still relatively quiet. Contractor pay rates have held steady.

In NSW we are still seeing a reasonable stream of both contract and permanent drafters for 3D design packages. The mining and associated sectors are very slow at the moment although we’re recruiting drafters in other industries for AutoCAD, SolidWorks and Inventor designers across NSW. Generally speaking, rates are being driven down due to lacklustre demand for experienced candidates. We are still recruiting for experienced 3D designers and drafters with Solidworks, Inventor and AutoCAD.

Electronics, Software and Communications

The year began amazingly with a surge of demand for software development professionals, and this has continued to be so now that Easter is past. Software development is, of course, a smorgasbord – specific areas of demand have varied widely and no one technology (platform or language) has been dominant – we have had requirements for C and C++ with Linux and Windows, embedded systems with multi-threading, web applications developers, C# with .NET, PHP, Android OS development, not to mention software test – or almost any combination you can think of. Even so, software development has not been the only active area in the recruitment world this last 3 months, with demand (somewhat surprisingly) for electronic production management/procurement/engineering support personnel plus a selection of electronics engineers with EMI/EMC or test or similar product validation experience.

So what conclusions can we draw from all this frantic activity? Firstly, it confirms that technology and engineering recruitment is not seasonal unlike fruit picking or whale watching. Secondly, it reminds us that manufacturing may not be as moribund as some suggest it is. Thirdly, that trying to predict demand levels and skill requirements is best left to those with time and resources far greater than the average humble recruiter. Salary pressures continue in opposing directions – candidates seeking to improve their lot and companies keen to keep costs blowing out. This is always an interesting point of debate in which the recruiter seeks to find middle ground – not always possible. Salary levels seem to have actually fallen as an average in the past year or so, according to some recent statistics and anecdotally I think I would be inclined to agree. If you want to move to greener pastures, all one can say is to be realistic in your expectations.

The one area that has not had much demand this past few months, from our vantage point, is contracting, with very patchy hiring requests coming in. If the trend continues to mid-year, then perhaps some who are in the long term contract mould may need to review their preferred mode of employment. Time will tell.