Hiring Trends in Australia: Sector Update for 2025 Labour Market

The Australian labour market has entered 2025 with a complex mix of increased job seeker activity, declining job vacancies, and evolving employer expectations. According to recent data, job advertisements have dropped by 11%, while applications have risen by 22%. This shift highlights a more competitive job market, where more candidates are vying for fewer opportunities.

Wage growth remains steady at just over 3%, while inflation has eased to 2.4%. This slight real wage increase offers some financial relief to workers. However, the hiring landscape is still challenging for employers and job seekers alike. Confidence among hiring managers has declined, with only 63% feeling positive about securing the right talent—a 4% decrease from the previous year. Job seeker sentiment has also weakened, with just 54% expressing confidence in their ability to find employment.

Unemployment has edged up to 4.2%, from a previous low of 3.2%, adding another layer of pressure. One of the main recruitment challenges identified by employers is the volume of irrelevant applications, particularly in New South Wales, Victoria, and Western Australia. This issue reflects a misalignment between available roles and candidate skill sets, even as applicant numbers increase.

State-level trends offer more insight. Western Australia shows the highest job seeker activity at 73%, but job advertisements have declined by 12.9%. Meanwhile, Victoria has seen the steepest drop in job ads at 17%, coupled with rising concerns over candidate reliability and ghosting. While there are more candidates per role, the market remains difficult to navigate, especially for employers seeking quality over quantity.

"It would seem that it is an employer’s market, but the quality and reliability remain a hiring hurdle"

Liz Punshon, Victoria Director at people2people, provides a clear picture of the challenges facing Australia’s employment landscape. "It would seem that it is an employer’s market, but the quality and reliability remain a hiring hurdle," she says. Her insight reflects the growing disconnect between high application volumes and actual candidate suitability.

According to Liz, Victoria has been particularly affected. "We've seen the largest job ad drop at 17%, and it's accompanied by a rise in ghosting and reliability issues," she notes. This suggests that while more candidates are entering the job market, employers still struggle to find applicants who are both skilled and committed.

The job seeker dynamic is shifting, with more activity but reduced confidence. "Job seeker confidence has dropped six percent, down to just 54%," Liz points out. She attributes this to increased competition and fewer available roles, which contribute to uncertainty among candidates.

Employer sentiment has also declined. "Only 63% of employers feel confident in finding the right talent, which is down by four percent year on year," she explains. Even with more candidates per job posting, finding the right match remains a key challenge.

Liz underscores that this environment demands a more strategic recruitment approach. Employers must refine their hiring processes, enhance job descriptions, and focus on attracting candidates with aligned values and skills. "With unemployment at 4.2% and irrelevant applications rising, hiring is no longer just about volume—it’s about precision," she concludes.

Tips for Hiring in a Competitive Applicant Market

• Optimise job listings with clear role expectations to reduce irrelevant applications

• Implement thorough screening processes to assess reliability and fit

• Leverage data to refine candidate targeting and outreach efforts

• Offer realistic and competitive compensation based on updated wage benchmarks



• Provide timely feedback to keep qualified candidates engaged and reduce ghosting