Government excludes most of the industry with its bone-headed 457 visa changes

After initially looking like recruitment consultants would be removed from the Short-term Skilled Occupation List (STSOL) it was announced, two weeks ago, that Recruitment Consultants will remain on STSOL but with a significantly increased income threshold of $90,000 and only available to agencies with a minimum $1 million p.a. turnover and at least 5 employees.

The RCSA managed to generate some column centimetres about the great recruitment consultant shortage in the week leading up to the Federal Government decision, which appears to have paid partial dividends.

Just over three years ago I commented that I was happy to see a reduction in the number of recruiters in Australian holding 457 visas as relying on overseas recruiters reflects poorly on our industry’s capability to recruit and retain our own employees. I still hold the view that a lesser reliance on skilled labour from overseas is a good thing.

I contacted Nick Deligiannis, the Managing Director of Australia’s largest recruiter of recruiters, Hays Australia, for his view. Here’s what he had to say on the topic:

My view is that we should continue to do what we have always done; recruit Aussies wherever possible as a first priority; continue to commit to Aussie trainees and invest in their training so they develop into skilled recruiters but leave us open to the option of supplementing shortages through hiring recruitment consultants on visas as well.

 The Government’s original proposal to take Recruitment Consultants off the STSOL was illogical if you compare recruiters to the many other occupations that are on the STSOL. The revised decision, with the $90k minimum salary, is clearly out of sync with the market reality and would not pass any market testing exercise.

As I reported late last year Hays have been hiring at a net rate of one new recruiter per day; managing to fill a large majority (confirmed by Deligiannis) of these roles with Australian citizens or permanent residents.

Dig into the employment history of a random selection of high performing recruiters and successful agency owners in Australia and I am very confident that Hays will appear more often than any other agency. This says much about the quality of Hays’ recruitment and training. Hays are the largest recruitment agency in Australian and have significant resources devoted to recruiting and training recruitment consultants and the whole industry benefits (more so than Hays would like, of course) from this investment.

Hays’ (or any equivalent agency) contribution to the industry’s training of recruiters appears to be a factor not taken into consideration in the flexibility (or lack of it) in the Federal Government’s recent STSOL decision.

This decision would be much fairer if:

a) There was greater flexibility (with respect to the current STSOL parameters) for agencies that consistently recruit and train Australians, and no flexibility for those agencies that just want to cherry pick the market of skilled talent and have no trainee program.

b) Rather than exclude agencies with under $1 million turnover and fewer than five employees from the STSOL, the opposite should be the case – these agencies need to be positively favoured by the parameters of the STSOL. It’s these agencies (that make up a large majority of Australian recruitment agencies) that really need to be able to hire experienced recruiters via the STSOL.

Agencies of this size simply don’t have the resources to consistently attract and retain Australian recruiters (in the major cities, at least).

There’s a big upside for these micro owners in being about to recruit an experienced recruiter via a visa program as it maximises the chances that they can use this experienced recruiter to grow their business at a faster rate than they otherwise could as well as mentor trainee recruiters.

These two factors significantly enhance the health of our industry where it’s most critical – at the grass roots.

Of course, the $90k base salary is ludicrously high (even in Melbourne or Sydney, let alone anywhere else) for an agency with fewer than five employees to pay for a recruitment consultant who would, almost always, be starting without any existing network. A figure of $75k would be much more realistic.

As always, the RCSA will continue to take up the fight on behalf of the whole industry and it’s yet another reason why all agencies should be members of the RCSA; together we are stronger.

An industry that’s not organised and well-resourced is easy prey for a government that has a history of kowtowing to rent-seekers and ignoring those less-well-organised and resourced sectors, such as ours. The recruitment agencies operate in a truly competitive market; a market that plays a major role in helping companies build a competitive advantage through the sourcing and recruiting of labour, both high-skilled and low-skilled.

In the meantime, all Australian recruitment agencies can at the very least make sure they have an attractive ‘Work For Us’ page on their website as a clear demonstration that they are serious about doing everything they can to attract and recruit Australians into recruitment as a career.

If you want an idea of what you might do then look no further than the Work with Us page of Canberra’s HorizonOne (fewer than 20 employees) for inspiration – great work Simon, David and the rest of the HorizonOne team; you are a shining example  of practising what we, as an industry, preach.

related blogs
Hays hiring surge: ANZ division grows by 65 consultants in past quarter
Do we really need recruiters on 457 visas?
Australia still a global laggard in talent practices: Netherlands #1

5 Comments

  1. Simon Cox on 31/01/2018 at 1:13 pm

    Another strong article Ross, and many thanks for the mention.

    I wonder if the $90K salary includes bonuses/commission (i.e. TEC less super)?

    I also wonder where that number comes from? Plucked out of air by a policy analyst and what evidence was used? Or does it represent ‘management level and above’? If the latter, I think it is the engine room recruiters that represent the biggest shortage in the market, not Managers.

    • Ross Clennett on 31/01/2018 at 3:28 pm

      No problem, Simon, I’m always happy to highlight the great stuff many companies in our industry, such as yours, are doing.

      I agree with our questions/comments re the minimum salary level (I assume it is base salary only but I don’t actually know). It seems random and not consistent with the level of recruitment consultant that is in greatest demand. This is what happens when little or no objective analysis is done by policy makers, unfortunately.

    • Chris Gander on 01/02/2018 at 9:05 am

      Looking at the list of Short term skills it really is a joke for some of the categories, especially those that can be trained locally.

      Recruiters is one category that is laughable and in my opinion used as a wrought for assisting entry into Australia.

      Recruitment Companies using 457’s should take a real hard look at their internal training processses and investing in their existing staff.

      Starting with contacting you Ross, and adopting some of your programs.

      The 457 process is now lengthy and expensive. The same $$ invested in local training would be far more value.

  2. Charlie Cameron on 31/01/2018 at 7:25 pm

    Base excluding super Simon. This government is hard to understand sometimes. RCSA back to Canberra soon to work on a more constructive way to inventivise the training of Aussie consultants. They at least acknowledge they need better data to make these decisions.

  3. Simon Cox on 01/02/2018 at 9:09 am

    So no clarification of bonus/commission involved CC? As the ATO (govt.) see it our salary includes bonuses and commissions. It may be fair to assume a $65K consultant with $35K in commissions fits into this?

Leave a Comment





This site uses Akismet to reduce spam. Learn how your comment data is processed.