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Global credit crunch stalls recruitment -

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LISA MILLAR: A national survey has found many Australian companies are putting their hiring on hold
because of growing uncertainty about the impact of the global credit crisis.

The Hudson recruitment firm surveyed around 7000 managers who do the hiring and firing for their
companies.

Many said they were less optimistic about putting more staff on the payroll.

As a result, the survey recorded the first drop in employer confidence in two years.

Hudson's managing director Gary Lazzarotto has been speaking with our business editor Peter Ryan.

GARY LAZZAROTTO: Given the amount of information in the marketplace now regarding uncertainty of
economies and the financial situation in the States, it's not surprising that we would expect to
see some slowdown in hiring, and what we have seen, in fact, is a slight reduction.

PETER RYAN: So are we at a point where employers are saying, "Let's wait and see what happens in
the US before filling positions or creating new ones here"?

GARY LAZZAROTTO: Yeah, particularly in the financial services sector. We saw an 11 per cent drop in
the number of companies looking to increase their headcount for the next quarter.

Now, obviously tied to what's going on in the world, financial markets, that's not surprising. But
what is interesting is that they haven't moved into the category of downsizing. That 11 per cent
has moved more towards the steady status, so which means that they're not actually... they're not
actually going to downsize their business, but more as people leave they'll replace them, but not
going to actively increase their headcount. So in many respects they're adopting a wait-and-see
approach.

PETER RYAN: What are you hearing about downsizing? Does that sound like that possibility is on the
horizon, given the current volatility on the sharemarket, but also the global uncertainty?

GARY LAZZAROTTO: At this stage we've not seen any movement in the number of companies looking to
downsize, other than in the ACT, where the number moved from around six to 13 per cent of companies
actually looking to decrease their number of employees. That's quite a shift. Nationally, that
number stayed around the five or six per cent so that hasn't moved. I think, you know, going
forward, there'll be probably more caution, it'll be interesting to see the results at our next
survey in about 90 days.

PETER RYAN: In the ACT, for example, you've mentioned that that's had the worst record in this
survey for four years. Now, the ACT is the centre of a lot of government jobs, but is that the main
factor?

GARY LAZZAROTTO: I think it's certainly one of it. There seems to be a degree of uncertainty as to
what will happen in terms of hiring in the ACT.

We have a new Government, it's... you know, there's a budget to still be... to be announced, so I think
there's certainly a degree of uncertainty around, you know, what will happen in terms of the hiring
market there. That then does roll on to the general economy in Canberra as well.

PETER RYAN: And not surprisingly, employers in Western Australia have the highest rate of optimism.
This sounds like more evidence of a two-speed economy in Australia.

GARY LAZZAROTTO: That's probably not a bad assumption. We've had WA, Queensland and South Australia
have been leading in terms of hiring intention for a little while now.

WA and Queensland both had drops of nine and eight per cent respectively, however still remain
amongst the highest, at 53 and 46 per cent of companies looking to hire, and South Australia in
fact actually bucked the trend and improved four per cent, so we're certainly seeing that different
approach. What was interesting also was that New South Wales remained even, so no drop in
expectation there, and as we mentioned earlier, Victoria and ACT both had a six per cent drop.

PETER RYAN: Are you finding that there's any growth in people coming to you as a recruiter, given
some of the uncertainty that we've been seeing?

GARY LAZZAROTTO: It's been a very buoyant economy and a very competitive job market, so certainly
the number of candidates who are considering... or employees that are considering looking at options
has increased.

I mean, you know, we saw something... more than one in two candidates in a recent survey we
conducted, more than one in two employees said that they were either actively or passively
considering options. So there's certainly been movement in the job market.

As the economy tightens, you know, you would expect people may start to opt for security, but
certainly I don't think we're at that stage yet.

LISA MILLAR: That's Gary Lazzarotto, the managing director of the recruitment firm Hudson, speaking
with our business editor Peter Ryan.