The hiring market may be stabilising in parts of the economy, but for young people trying to enter the workforce, it feels anything but steady.

Entry-level opportunities are shrinking, graduate programs are scaling down, and confidence is fragile.

Talent placement data has shown entry-level hiring has dropped by 19% compared to two years ago and on the ground, that decline is palpable.

“With unemployment in New Zealand at its highest level in years, it’s hard not to lose confidence,” says Shanelle Partridge, Youth Program Manager at our social enterprise Rise by Talent. “There just aren’t many entry-level roles being advertised. For rangatahi, it’s really hard to navigate right now.”

And the challenge isn’t limited to any particular demographic. It spans school leavers, graduates, and young people coming through skills-based programs.

“It’s hard for everybody at the moment,” Shanelle explains. “But it’s especially hard for diverse communities where that door wasn’t fully open before and it’s certainly not wider now.”

Is the first rung disappearing?

For decades, entry-level roles acted as the first rung of the career ladder. It was a time and space to learn, experiment, and build capability.

And today? That rung is thinning.

A combination of tight budgets, cautious hiring and AI-driven productivity gains has changed how organisations think about junior roles. Many are prioritising experienced hires who can “hit the ground running” rather than investing in capability building.

“There’s a shift happening,” Shanelle says. “We’re seeing grad programs being cut back, and more emphasis on skills-based hiring over formal qualifications. It’s not just about having a degree anymore. Employers are asking: can you think critically? Are you curious? Can you solve everyday business problems?”

That shift isn’t necessarily negative. But it does raise a bigger question: what happens when organisations expect “next-level” capability without creating the pathway to get there?

AI: Opportunity and anxiety

AI is definitely part of this conversation but not exactly in the ways the headlines suggest.

Young people are, in many cases, ahead of the curve on the tech front.

“Rangatahi are already AI-literate,” Shanelle says. “They’re using it to plan workflows, build bots, create presentations, tell their story. They’re not scared of it.”

In Rise programs, storytelling exercises often involve AI tools from day two.

“They’re experimenting confidently — often before organisations have even rolled out AI literacy internally.”

But literacy doesn’t automatically mean discernment.

“There’s still a huge education piece needed,” Shanelle adds. “Young people might recognise AI content quickly, but do they always apply a critical lens? That’s something we still need to build.”

And there’s a deeper layer for Māori and Pasifika communities.

“There’s fear around what AI means for our communities and entry-level roles. We’re slower to get AI literacy into those spaces and that’s something we need to address.”

The pressure to be “job-ready”

One of the most significant shifts in the early-career landscape is employer selectivity in a candidate-saturated market.

“With some job postings attracting 1,000 applications in a few days, organisations can be extremely picky,” Shanelle explains. “If you’re not one of the first CVs through the door, it’s hard to even get seen.”

High application volumes don’t necessarily translate to better opportunity either. Instead, they’re raising the bar for what “entry-level” means.

Organisations are asking for:

• Immediate contribution
• Strong interpersonal capability
• Commercial awareness
• Confidence and initiative

All without necessarily investing in structured development.

And for rangatahi Māori and Pasifika, additional pressures compound the challenge.

“Family is central,” Shanelle says. “If young people need to contribute to rent, mortgage or bills at home, they’ll take any job they can get. Tech might not feel accessible straight away if the door isn’t clearly open.”

That tension between economic necessity and long-term career aspiration is felt within these communities.

Why cutting entry-level roles is short-sighted

In our latest salary guide, we highlight a growing gap where short-term cost discipline risks long-term talent shortages.

This early-career squeeze is a clear example.

“If we don’t create those pathways now, who manages the business later?” Shanelle asks. “We need young people in the system so we can future-proof leadership.”

The solution doesn’t have to be large-scale graduate programs. In fact, in a tighter market, more agile approaches may be more effective.

“We’re seeing organisations rethink what entry-level looks like,” she says. “Project-based roles. Breaking down tasks within existing roles. Asking: is there something here that a junior person could own?”

Some Auckland-based employers are now reviewing every vacancy and asking a simple question:

“Is there any part of this role that could be carved out for entry-level talent?”

If yes, they create space for it with intention and to proactively future-proof their workforces.

So, what can businesses do now?

Practical starting points include:

• Identifying project-based entry opportunities
• Earmarking a small number of roles each year for junior talent
• Partnering with organisations like Rise to align training with industry need
• Reviewing roles to carve out structured development tasks

“We created Rise to bridge that lag between what industry needs and what education delivers,” Shanelle says. “Tech changes fast. Waiting three or four years for a pipeline to come through uni doesn’t work anymore.”

And bridging that gap responsibly is now critical.

The long game

The early-career squeeze isn’t just an issue isolated to just young people trying to get their foot in the door. It’s now a workforce strategy issue.

When organisations reduce entry-level intake, they may ease short-term cost pressure but they also narrow their future leadership funnel.

And when the market tightens again — as history suggests it will — that pipeline gap becomes expensive.

Young people aren’t lacking ambition or adaptability. In many cases, they’re more technologically fluent and agile than the environments they’re trying to enter.

The question now is whether businesses are willing to meet them halfway.

Explore how capability gaps are reshaping hiring in our More than Money Salary Guide, including insights into early-career trends and long-term workforce planning.

If the last few years were about building, 2026 is about selling.

The Digital hiring market across the US has regained momentum, but venture-backed businesses are no longer hiring on ambition alone. Consultancies aren’t scaling delivery teams ahead of demand, and every hire is being measured against revenue impact and time-to-value.

As Jason Pho, Director of Technology Recruitment in our New York team, puts it:

“After a slow 2024, we saw an uptick in 2025 and it’s been trending up since then. The market feels more stable now. There are still good local candidates looking, and there’s opportunity out there. You just need to filter through the noise.”

Revenue first: GTM and sales demand accelerates

Over the past couple years, funding was being poured into product development, scaling engineering teams, and expanding roadmaps.

Now, the pressure has shifted downstream.

“In the startup space, the last few years were about building and now it’s about selling,” says Jason.

Go-to-market and sales hiring has become one of the most active areas in the Digital ecosystem and, beyond growth, companies are fighting for clear differentiation in a saturated AI market.

“There are so many new AI tools now that a lot of companies are honestly confused about how they get real ROI from them,” Jason explains. “You can roll out a new tool, but if you don’t change the process around it, it just creates more noise.”

This is where proven sales professionals with a track record of new business development, complex deal cycles and pipeline generation are in high demand across startups and consulting firms alike.

And we’ve found that smaller boutiques are also benefiting in this market.

“Smaller firms can compete with the Big Four now,” Jason has observed. “Tech is cheaper, delivery can be faster, and clients want more flexibility and customized solutions instead of ‘this is how we do it’.”

In today’s market, agility is an edge.

AI hiring: proof over potential

If the last two years were about experimentation, 2026 is where it gets real.

“Companies are moving past ‘AI in theory’ and pushing for proof you’ve actually done it,” says Jason. “Where have you implemented something? What changed? What was the net positive outcome?”

The interview questions are sharper:

• What went live?
• What improved?
• What was the measurable business impact?

“A lot of candidates get unstuck because they’re still speaking in hypotheticals and proof-of-concepts rather than outcomes.”

At the same time, AI has complicated the hiring process for both sides.

Jason explains:

“AI-written resumes, AI screening tools, automated outreach. It can actually make it harder to identify genuinely strong candidates. I think the big differentiator in the hiring process is still communication; how candidates are treated and the human interaction. People ultimately remember how the process felt.”

In-house capability is rising

Another defining trend in 2026, not just limited to the Digital space, is the shift towards internal capability building.

“It’s about price and control,” says Jason. “The consulting market is crowded and competitive but, more than that, a lot of organizations want the IP and capability in-house.”

Especially in traditional sectors like manufacturing and government, more end-user organizations are building internal Digital teams rather than outsourcing entirely.

As a result, permanent hiring has become the preferred route for core AI and platform capability, while contract demand is more selective and often tied to defined programs of work rather than open-ended transformation mandates.

“People don’t see full-time as ‘stable for life’ the way they used to,” Jason shares. “And employers still like the flexibility contractors bring.”

True career contractors remain outcome-driven: enter, deliver, exit, repeat. While employers are being more deliberate about where they lock in long-term capability versus where they flex.

Compensation has also largely stabilized year-on-year as the market becomes more predictable and employer-leaning. But proven, revenue-aligned talent will continue to command a premium, particularly those with real AI implementation experience.

Engineering for outcomes, not output

AI has also reshaped workforce design with some startups asking: can we hire fewer AI-enabled engineers rather than scaling traditional dev teams?

But Jason warns that speed without alignment is risky:

“Before, you needed a team decision on what to build. Now, anyone can spin something up quickly. But is this what the business actually needs? Does it fit the product? The strong engineering candidates in today’s market are the ones who can decisively say: here’s what the business needs, here’s what we should build, and here’s the return we’ll get.”

In other words, leverage and the need for judgement has increased.

More than just technical capability, expectations also include commercial awareness, product alignment, and the ability to collaborate effectively across stakeholders. As build cycles accelerate, decision-making quality becomes the real differentiator.

And that’s where environment starts to matter.

High-performing teams don’t just rely on individual outputs, they rely on shared context, fast feedback loops, and strong communication. In an AI-enabled world, how teams work together is becoming just as important as what they build.

The 2026 reality

Growth has returned, funding is flowing more steadily, and consulting pipelines are strengthening. However, unlike previous cycles, hiring is being driven by outcomes rather than ambition alone.

AI has accelerated build cycles and expanded what small teams can achieve, but it’s also raised the bar. Candidates are expected to prove production impact, engineering leaders are prioritizing alignment, and commercial teams are being hired to convert innovation into revenue.

At the same time, workforce design is becoming more intentional. Organizations are deciding where to lock in long-term capability, where to flex with contractors, and how to structure teams around performance rather than headcount.

In 2026, the market is sharper and the organizations that win will the be the ones that hire with clarity.

Explore the latest AI and Digital permanent salary and contract rate benchmarks in our More Than Money Salary Guide to ensure your hiring strategy is aligned with today’s market realities.

In 2026, the Microsoft hiring market has become sharper.

Last year, we reported a surge in demand across Microsoft Biz Apps, Cloud and Data as organizations reignited delayed transformation projects and this year feels like another step-change.

As Dylan Cohen, Director of Microsoft & Cloud Solutions in our New York team, puts it:

“AI’s now at the point where companies are putting it into production, not just experimenting or piloting it.”

This production versus proof-of-concept distinction is what’s defining the market this year.

From experimenting to real-world results

Twelve months ago, many organizations were still experimenting by testing and running pilot; giving users access to tools like Copilot, Claude and ChatGPT. Consultancies and Product companies were offering a taste of AI, demonstrating different use cases and offering proof of concepts, and as soon as those 2-8-week engagements would end, many companies found themselves stalling from taking the next step.

Now, the conversations are different, and AI hiring has matured quickly.

“The thing that’s changed is moving away from companies solely looking at user adoption with AI, to hiring AI Architects who’ve actually put AI into production,” Dylan explains. “Clients want to speak to candidates who’ve delivered end-to-end, full life cycle AI projects.”

The key questions in interviews today are:

• Did it go into production and is the company using it today How so?
• What was your role in delivery?
• Was it proof of concept or live deployment?
• How is the business benefiting?

“What we’re uncovering is there’s a lot of proof of concepts, but limited real-world experience in actual production and outcomes,” says Dylan. “Candidates who’ve deployed AI in production should be screaming from the rooftops about it. They’re a small subset compared to the rest.”

AI spend: readiness vs build

With a better understanding of what’s capable with AI between now and this time last year, companies have a more focused strategy with their AI hiring.

According to Dylan:

 “The strongest clients are starting with getting their foundations right: data cleansing, governance and clear alignment on the end goal before they ‘go crazy with AI’. The big change versus this time last year is confidence. Now they understand what they need to do and they’re putting real roadmaps and project plans behind it.”

Across consulting, the era of endless pilots is fading fast.

“Proofs of concept were the story of last year,” he says. “This year, companies are confirming budget, agreeing on business value and moving from prototypes into production.”

Financial services, insurance and healthcare are industries leading the charge, and product-led firms are attracting private equity on the back of real and tangible AI deployment.

D365 demand: Copilot changes what “good” looks like

Hiring demand across Dynamics 365 remains strong.

“All three areas, F&O, Business Central and CRM, are busy,” says Dylan. “Enterprise budgets have reset and we’re seeing clear uptick in F&O alongside continued strength in CRM.”

But Copilot is what’s raised the baseline.

“It’s no longer enough to simply know Power Platform,” he explains. “Now the expectation is: can you build Copilot-ready workflows? Do you understand AI agents? Can you speak to readiness and use cases in a practical way?”

CRM in particular has seen one of the biggest shifts:

“Functional and technical CRM consultants are expected to understand Copilot readiness and how AI fits into the solution. That doesn’t mean deep AI engineering expertise, but the need to be able to speak to it with confidence.”

And the candidates who stand out are the ones who proactively prove it.

“We’ve seen candidates who go out of their way to demo what they’ve built with Copilot in interviews. And nearly every candidate who’s brought something tangible into an interview has landed the role.”

Permanent vs contractor shifts

Last year, companies were racing to secure contractors for AI-specific initiatives and this year, the hiring trends have shifted.

“In the Microsoft space, especially within consultancies and product companies, the bias toward permanent hiring is stronger,” says Dylan. “If they find someone strong, they want to lock that capability in long term.”

Talent who can genuinely deliver are being treated as a strategic hire for businesses.

End users are more mixed; often leaning on consulting partners for roadmap and production delivery, then supplementing with embedded contractors for validation or oversight.

And interestingly, career contractors are even adapting to this demand.

According to Dylan:

“Some high-end contractors are saying they’d move to permanent if it’s the right company. Meaning that strong product ambition, smart teams, and real ownership are becoming important factors to these candidates.”

All signs are pointing to a hiring market that finds value in long-term retention of high-value capability, not just in the AI space.

Decisive hiring wins and hybrid still wins

The best leaders are focused on building world-class teams.

In an employer-driven hiring market, many organizations are holding out for the mythical 100% fit. But in a limited candidate pool where delivery experience is scarce and time-to-value is increasingly important, this strategy can backfire.

“I recommend that 80% fit,” says Dylan. “The last 20% can be trained but while you wait, your team and business are suffering. If you’re sitting on the fence trying to find that perfect candidate, reflect on: How long has the role been open? How many candidates have you actually vetted? If you’ve spoken to 20 aligned candidates and still can’t decide, you’re either not ready to hire or you’re being too selective.”

Whether it’s hiring for a sales, consulting, or engineering role, the strongest employers are defining outcomes early, aligned on success criteria, and move quickly once they find the right candidate.

Strategic working models are also playing a significant part in candidate decisiveness. Despite high-profile return-to-office pushes in recent years, hybrid continues to win in the Microsoft ecosystem.

“Five days onsite still hurts attraction,” Dylan notes. “Hybrid just keeps working.”

The firms insisting on full-time onsite, particularly in non-metro areas, are shrinking their talent pools unnecessarily.

In short: the organizations winning in 2026 are clear on outcomes, realistic on profile expectations, and flexible enough to attract the talent capable of delivering.

What’s next: the end of time-and-materials?

Looking ahead, there are murmurs of another structural shift emerging.

Dylan explains:

“This time next year, we’ll be talking about how consulting firms moved away from time-and-materials and toward deliverables and outcomes.”

With AI accelerating build cycles, traditional 2,000-hour project models are under pressure and effort becomes less sellable than the project’s impact.

“If AI is doing what used to take weeks of programming time, companies still provide value. But how do they monetize that in an outcome-based model?”

The 2026 reality

The AI hype of previous years has given way to maturity for the Microsoft hiring market.

AI is no longer a slide in a strategy deck or an experiment run by an innovation team. It’s embedded into delivery roadmaps, tied to budgets, and increasingly measured against real business outcomes.

And that shift is raising the bar.

Candidates are being asked to prove production impact over theoretical exposure, consultancies are being pushed to demonstrate end-to-end capability, and organizations are evaluating partners on governance, adoption, and time-to-value rather than technical ambition.

At the same time, hiring strategies are becoming more disciplined. Companies are locking in long-term AI capability where it matters most, reassessing workforce structures, and aligning roles directly to measurable outcomes.

For leaders shaping their Microsoft workforce strategy: prioritize production experience, move decisively, and build teams that can both design and deliver real impact.

Explore the latest Microsoft, Dynamics 365 and AI salary and rate benchmarks in our More Than Money Salary Guide 2026.

If you’re waiting for the telecommunications hiring market to “heat up” again, you might be looking for the wrong signal.

Because in 2026, the market is less “hot” and more focused.

As Steve Dybacz, Account Director and in-house telco expert at Talent Sydney, puts it:

“Two years ago there was a lot of vanity hiring. Now it’s about one question: can you actually deliver this programme without drama?”

This mindset shift is what’s defining telco hiring right now; more accountability and a much sharper lens on capability.

From hype to optimisation

12–24 months ago, 5G dominated the conversation. Today, the narrative has evolved.

“Fibre is still busy. 5G has moved from hype to optimisation,” Steve explains. “And we’re seeing far more spend on resilience and compliance than on flashy innovation.”

The build phase is far from over. Fibre rollout continues at pace as copper networks are decommissioned, while optimisation of existing infrastructure is now front and centre. Coverage, private networks and uptime are commercially critical — not just headline projects.

“Fibre and core network capability remain critical because the build is still happening — and copper is dying. That transition hasn’t slowed.”

At the same time, regulatory pressure, cyber risk and infrastructure funding cycles are shaping investment decisions.

“Resilience is no longer optional,” Steve says. “It’s a board-level issue.”

The skills that matter most this year

Hiring demand across telecommunications is clustering around a core set of high-impact capabilities:

• Network Engineering
• Fibre Optical Network Engineering
• RF Engineering
• Telecommunications Project Delivery
• Field Network Operations & Maintenance
• Network Operations (NOC)

RF engineering, in particular, is seeing renewed importance.

“RF matters more than the headlines suggest,” says Steve. “Coverage, optimisation and private networks are commercially important right now.”

And as budgets tighten, delivery risk is under scrutiny.

“Project people are in demand because budgets are tighter and failure is expensive. Organisations can’t afford programmes that drift.”

Meanwhile, operational roles are under relentless pressure.

“NOC and field capability doesn’t get the spotlight, but uptime is brutal and SLAs are unforgiving. That pressure isn’t going anywhere.”

This is not a speculative hiring cycle. It’s capability-led and operationally grounded.

The talent that’s hardest to find

While overall salary growth has stabilised, structural shortages remain in specific areas.

“The hardest profiles to secure are senior engineers who’ve actually designed the solution and then stood on site to deliver it,” Steve says. “That combination is rare.”

Candidates with the right clearances also remains particularly scarce.

“Cleared talent is a tiny pool — and everyone’s fishing in it.”

And there’s a noticeable thinning of the mid-market layer.

“Solid mid-level engineers who don’t need hand holding are surprisingly scarce. The market has thinned out in that middle layer.”

These gaps reflect a broader theme we explore in this year’s More than Money Salary Guide; skills and capability depth is becoming more important than job titles and headcount.

AI in telco: Evolution, not replacement

AI is increasingly present in telecommunications but not in the way headlines might suggest.

“It’s in optimisation, fault prediction and ticket triage,” Steve says. “It’s not replacing engineers but making average teams better and exposing weak ones.”

Organisations investing in AI are pairing it with strong engineering fundamentals and governance. It’s about augmentation, not substitution — a theme echoed in our broader Capability Gap insights.

“The organisations getting value from AI are the ones pairing it with strong engineering fundamentals, not using it as a shortcut.”

Leaner teams, sharper expectations

One of the clearest structural shifts in 2026 is how telco teams are being built.

“We’re seeing lean core teams, with specialists bolted on for programmes. Nobody’s carrying excess headcount.”

Permanent capability is focused on critical continuity and governance. Specialist contractors are brought in for defined programmes and complex delivery.

“Everyone’s wearing two hats now: technical delivery plus stakeholder management. Purely technical roles are becoming rarer.”

Stakeholder capability, commercial awareness and communication skills are now as important as deep technical expertise.

Salaries: Flat overall, premiums in pockets

Broadly speaking, remuneration has stabilised across much of the telco market, but premiums remain in specific segments.

“Salaries are broadly flat, but there are clear premiums for fibre design, RF optimisation, cleared roles and proven programme leads.”

In-demand specialists are still moving quickly when the right opportunity appears.

“Speed wins offers. The best engineers still move quickly when the right opportunity comes along.”

And employer behaviour is still critical to success.

“If you treat good engineers like commodities, you’ll lose them. The top performers know their value.”

The biggest hiring mistakes

Despite a more balanced market, some hiring behaviours haven’t caught up.

“Slow hiring processes are still the biggest obstacles,” Steve says.

And there’s also a tendency to over-specify.

“Unrealistic wish lists don’t help. If you’re looking for someone who can design, build, secure and commercially lead a programme, you’re narrowing the field dramatically.”

And high application volumes can be misleading.

“There’s still a tendency to assume supply equals suitability. High application volume doesn’t mean high capability.”

This mirrors what we’re seeing across sectors: volume is up, but genuine capability remains scarce.

The telco organisations who will succeed in 2026

Rather than aggressive expansion, telecommunications in 2026 is about resilience, optimisation and delivery.

Organisations that succeed will:

• Secure specialist capability early
• Structure teams intentionally
• Pair AI adoption with strong engineering fundamentals
• Move quickly when the right talent appears

The market may not feel “hot”, but it is demanding.

And in a sector where uptime is brutal and SLAs are unforgiving, focused hiring may prove more powerful than hype ever was.

To benchmark telco salaries, contract rates and in-demand skills across Australia and New Zealand, explore our More than Money Salary Guide 2026, including our latest Key Trends shaping capability investment in 2026.

If you’re hiring right now, it might feel like the market has finally slowed down; attrition is down, roles are attracting strong application volumes, teams look stable on paper…

However, beneath the surface, a different story is playing out. Instead of loyalty or engagement, these choices are likely to be shaped more by market uncertainty, caution, fatigue, and financial pressure.

Enter ‘job hugging’. Coined last year on TikTok, it isn’t a trend that exists in isolation. Closely intertwined with other deeper issues shaping the workforce right now, it’s created one of the biggest blind spots employers face heading into 2026.

Staying doesn’t mean thriving

A Talent survey of over 1,800 professionals paints a confronting picture of how people are actually feeling at work.

Only 1 in 8 corporate workers describe themselves as genuinely happy in their role. And nearly two-thirds (68%) say they feel burnt out, stuck or unhappy — often driven by a combination of cost-of-living pressure and a difficult job market.

This employee dissatisfaction is also more widespread than most realise.

More than three-quarters (76%) of workers say they’ve felt close to burnout in the past six months. And over half perceive their workplace culture as either “toxic” or “declining”, while a minority of 15% believe their culture is genuinely thriving.

While many are staying, it’s no direct indication to engagement.

Burnout shows up long before resignations do

Signs of burnout appear much earlier in reduced engagement, lower discretionary effort, and declining performance. And when workers talk about cultural decline, they consistently point first to high turnover and low morale, followed by poor communication and lack of recognition.

By the time people reach burnout or leave, the damage has already been done.

Instead of a downstream people issue to be addressed after attrition spikes, signs of burnout and disengagement should be treated as early leading indicators of risk.

The false comfort of low attrition

Job hugging and burnout together can create a false sense of security for employers.

When people aren’t moving, it’s easy to assume they’re settled and engage. But, in reality, many are simply waiting. In our survey, 7 in 10 workers say they would leave their role if they could, while 65% report staying put due to financial constraints rather than commitment.

Confidence in employers and business leaders is also fragile. Over two-thirds of workers don’t believe their employer would fight to keep them if they resigned, and the disconnect suggests many employees don’t feel valued or invested in.

As Matthew Munson, Managing Director at Talent Sydney, has observed:

“People aren’t moving, but that doesn’t mean they’re engaged or confident about staying long term. That creates a real blind spot for employers who assume low attrition means low risk.”

When confidence returns — and history tells us it always does — all this pent-up movement can be swift and disruptive.

Why salary alone won’t fix this

While it’s tempting to respond to disengagement with pay adjustments or short-term incentives, data suggests this is a problem that runs deeper.

Among the small group of workers who say they are happy, that happiness consistently comes with conditions: flexibility, supportive managers, autonomy, and trust. For some, it means working for themselves. Across ANZ, LinkedIn data shows a 43% 12-month increase in self-employment, a pattern historically linked to periods of market uncertainty and constrained job mobility.

This is less about perks or surface-level engagement initiatives and about how work is experienced day to day.

As Tom Mackintosh, Managing Director at Solve by Talent, puts it:

“There’s often a lot of focus on fixing talent acquisition when engagement drops, but that usually just exposes the real issue. In many cases, it comes back to leadership capability and whether organisations are genuinely invested in learning, internal mobility, and long-term career growth.”

The compounding risk for 2026

Heading into 2026, the risk isn’t that people are leaving in droves but that many organisations are mistaking their people’s endurance as engagement.

Burnout suppresses productivity and job hugging suppresses mobility. Together, they delay the warning signs leaders would normally rely on — until the market shifts and attrition accelerates all at once.

In our latest More Than Money Salary Guide, we identified confidence, culture and leadership capability as core elements of the broader Capability Gap as direct influences to how resilient an organisation will be when conditions change.

What employers should be doing now

The organisations best positioned for the next cycle aren’t waiting for confidence to return before acting.

Instead, they are:

• Investing in leadership capability and workload sustainability
• Creating visible development and internal mobility pathways
• Treating engagement as a strategic risk indicator, not an HR metric
• Strengthening EVP before competition intensifies again

Because when the market turns, the difference between stability and resilience will be clear.

To explore how confidence, burnout and capability gaps are shaping the year ahead — including regional insights and emerging trends explore the full More Than Money Salary Guide, and dive deeper into The Capability Gap and Key Trends driving hiring decisions in 2026.

AI is already in the hiring room

AI is no longer knocking on the door of recruitment, it’s already inside.

From CV screening and sourcing to scheduling interviews and analysing candidate data, AI now touches huge parts of the hiring process. And while plenty of organisations are leaning in, others are quietly uneasy. The real question isn’t whether AI belongs in recruitment anymore. It’s how far should it go, and where do humans need to step back in?

To unpack the dilemma, we put it to our experts. Jack Jorgensen, General Manager – Data, AI & Innovation at Avec  argues the case for AI as a powerful enabler, while Georgia Hynes, Senior Talent Partner at Talent Wellington takes the opposing view, cautioning leaders against over-automation in a human-led profession.

Here’s where they landed.

The case for AI: smarter shortlists, less burnout

Jack’s position is clear: AI shouldn’t replace recruiters, but ignoring it would be a mistake.

“AI is already being used by candidates,” he explains. “If you don’t use it, you’re putting yourself at a disadvantage.”

From a candidate perspective, Jack sees real value. Many capable professionals struggle to articulate their experience and write a strong CV, especially those with non-linear career paths.

“There are people who can do the work but can’t sell themselves, AI helps level that playing field.” He says.

On the recruiter side, Jack argues AI can significantly reduce manual workload, particularly in high-volume markets.

“If you’ve got 200 applicants for a role, going through every CV isn’t a human experience either, AI can help surface the top 30% so recruiters can spend their time where it matters, qualifying properly.”

He also challenges the idea that AI creates dishonesty.

“People have lied on CVs for years. That problem didn’t start with AI, it just evolved.”

Used correctly, Jack sees AI as an enabler in supporting better recruitment, not making the final call.

The case against AI: recruitment is still human work

Georgia agrees AI has its place, but draws a firm line when it comes to decision-making.

“My job as a recruiter is knowing who will work out in a role and who won’t, that’s not something a machine can do.” she says.

From a client perspective, her biggest concern is over-reliance. When every CV looks polished (because AI helped write it), it becomes harder to spot what actually matters: a. can this candidate really do what their CV says they can do b. transferable skills, context, the ‘why’ behind a career move and the nuances that experienced recruiters see instantly.

“Humans can read between the lines. AI filters based on keywords. That’s where great candidates get lost.”

She’s also sceptical that AI can replace intuition, one of the most valuable tools an experienced recruiter has. “I can hear uncertainty in someone’s voice. I can hear when something’s off, even over the phone. AI doesn’t have intuition. It never will.” she explains.

Georgia also raises the risk of bias at scale. “AI learns from historical data. If past hiring was biased, you’re just repeating it at scale.”

And when it comes to video-based AI assessments?

“Honestly, abhorrent,” Jack adds. “Trying to simulate recruiter judgement through facial cues and voice analytics is a terrible experience for everyone.”

Georgia agrees “We’re not recruiting robots. Humans should not be filtered out by machines.”

The verdict: a mixture of both

Ultimately, this debate doesn’t land with a simple “yes” or “no”.

AI isn’t breaking recruitment, but misusing it can.

Used well, AI can help reduce recruiter burnout, improve focus, and help teams move faster through the early stages of screening. Used poorly, it strips nuances, amplifies bias, and filters out great people.

For leaders, the takeaway is clear: AI should support recruiters, not replace them. And human judgement must remain at the centre of every hiring decision.

The future of recruitment isn’t human or AI. It’s human with AI, used carefully, intentionally, and with experience leading the way.

Key takeaways

1. Candidate activity is rising fast as job ads remain at low levels
Applications per job ad have jumped sharply as Kiwis search for higher wages amid cost-of-living pressure. With job ads still below pre-COVID levels, TA teams are managing heavier shortlisting loads even as the overall market feels quieter.

2. Hiring conditions are showing early signs of a 2026 turnaround
The economy is beginning to lift, business investment is returning, job ads have ticked up, and most regions reported growth last month. New Zealand is shifting out of stagnation into slow but steady recovery.

3. AI is reshaping skill expectations, but NZ businesses are still early in adoption
Demand for AI-related skills has surged, especially in IT, marketing, and strategy. While only a small share of NZ jobs can be fully automated, most will see tasks change, elevating the importance of capability building and realistic early-career hiring.

Introduction

After two unsettled years for Aotearoa’s labour market, marked by rising unemployment, declining job ads, and cautious business confidence, leaders are looking for clarity to effectively plan for 2026.

To help map this out, we’ve combined our recruitment experts’ on-the-ground insights with SEEK’s latest market data from our recent webinar with Senior Economist, Blair Chapman, to unpack what the macroeconomic indicators can tell us about what to expect as we head into the new year.

New Zealand’s hiring landscape: National trends to watch for in 2026

Growth is returning after two slow years

After a soft and uneven economic period, New Zealand is finally moving back into growth. GDP is expected to return to pre-COVID norms, supported by stabilising inflation, easing mortgage pressures, and a lift in discretionary spending. This momentum will feed into employment over the next 6-12 months, setting the stage for stronger hiring conditions.

Inflation is easing and business confidence is improving

The RBNZ’s single focus on inflation has paid off: prices are stabilising, mortgage rates have eased, and wage pressures are cooling. With labour costs returning to normal levels, businesses are becoming less hesitant to hire, reversing the uncertainty seen over the past two years.

Job ads remain low, but early signs point to a turning market

New Zealand experienced a much sharper drop in job ads than Australia, but the tide is shifting. Most regions reported job ad growth last month, and ads are beginning to climb across key industries. While this is still below pre-COVID levels, this uptick signals that hiring demand is starting to return.

Surging applications per job ad, driven by local and offshore talent

Applications per ad have risen significantly, but the increase isn’t coming from Kiwis alone. TA teams are seeing a substantial volume of offshore candidates applying for New Zealand roles, adding to already larger shortlists. As a result, hiring teams are processing heavier pipelines even as overall hiring activity remains modest.

Wage growth is easing, reducing hiring hesitation

Wage growth has fallen back to around 2%, and as labour costs stabilise, employers are becoming more confident about adding headcount and planning. With candidates still sensitive to pay, salary benchmarking remains essential while businesses do have more breathing room than they did at the peak of wage inflation.

Consumer spending is lifting again

New Zealand households are beginning to open their wallets, with discretionary spending recovering. This is a positive signal for industries that tend to hire ahead of broader economic recovery, like retail, hospitality, tourism, and logistics.

AI is reshaping skill demand, but NZ adoption is still early-stage

References to AI skills in NZ job ads have surged, particularly in IT, marketing, and consulting. While only a small share of roles can be fully automated, most will see task-level change. Employers are beginning to redesign roles around augmented workflows, but many still lack the internal capability to define what “AI readiness” looks like. With this shift, structured early-career pathways and realistic skill expectations will matter more than ever.

Regional breakdown: Where hiring conditions are shifting most

National snapshot

New Zealand’s labour market recovery is uneven, and the pace varies significantly by region. After a year of rising unemployment and falling job ads, most regions have now recorded an uptick in hiring activity, signalling the early stages of a national turnaround. Employment movements have been mixed, with some areas stabilising while others continue to soften, and the impact of the downturn hasn’t been felt equally across the North and South Islands.

A few regional patterns to note:

• Canterbury/Christchurch: Employment has edged down, but job ad growth suggests recovery is underway.
• Southland & Otago: Both trending towards stabilisation, though not yet fully recovered.
• Central North Island: Some regions such as Taupō saw unemployment ticking down, showing surprising resilience.
• Taranaki: A regional outlier not showing recent job ad growth.

Against this backdrop, Auckland and Wellington sit at the centre of this shift, each with its own drivers: Auckland shaped by broader economic softness and cost pressures, and Wellington shaped by public sector contraction and policy-related hiring freezes. Other regions such as Canterbury, Central North Island, and parts of the South Island are also beginning to show signs of lift, while a handful like Taranaki remain slower to recover.

With this national picture in mind, here’s what employers need to know about the two markets where we see the strongest shifts and the greatest implications for hiring in 2026.

Tāmaki Makaurau / Auckland

Auckland has experienced the sharpest rise in unemployment and one of the biggest drops in employment over the past year. Job ads fell significantly from their post-COVID highs, and hiring demand has been subdued across professional services, construction, retail, and public-facing sectors.

But the turning point is beginning. Early indicators such as a lift in job ads and a gradual return of discretionary spending all point to stabilisation. As mortgage pressures ease and business investment improves, demand for talent is expected to slowly rebuild.

As Kara Smith, New Zealand Country Manager, puts it:

“Auckland has taken some of the biggest hits this past year, but it’s also where we’re now seeing the earliest signs of recovery. Job ads are lifting, spending is picking up, and more movement from employers. With Auckland driving approximately 38% of the country’s GDP, New Zealand as a whole will also benefit.”

For 2026, expect a steady, early-stage recovery with stronger demand in IT, logistics, consumer services, construction and professional roles once activity picks up.

Te Whanganui-a-Tara / Wellington

Wellington’s labour market has been shaped heavily by public sector contraction. Government pullbacks have driven job losses, increased unemployment, and reduced hiring appetite across many adjacent industries.

Even so, Wellington recorded employment growth over the past year. As public sector hiring stabilises and business confidence improves, the private sector is expected to lead the next phase of demand. Candidates remain active and competition for secure roles is high.

In the new year, there will be a cautious rebound driven by consulting, IT, policy-adjacent roles and private sector expansion as government hiring levels out.

Nik King-Turner, Managing Director at Talent Wellington, adds:

“New Zealand absorbed the economic shock of COVID earlier and more sharply than Australia. The view is now that Australia may soon experience some of the same pressures we’ve already worked through, and that could slow the flow of Kiwi talent heading offshore. If that happens, Wellington employers could benefit from greater talent stability at a time when public sector hiring is beginning to level out.”

What employers should prioritise in 2026

With hiring conditions beginning to turn, employers should be preparing now for a more competitive and fast-moving 2026.

Rebuild hiring confidence and capability

As growth returns and job ads lift, competition for talent will increase again, especially in IT, professional services, logistics, construction and health.

Manage surging application volumes

High application numbers mean more administrative pressure on internal TA teams. Streamlined screening, clear criteria, and fast communication will be essential to avoid losing quality candidates.

Refresh early-career pipelines

AI-related roles are evolving quickly, and demand is outpacing supply. Cutting junior pathways only widens the capability gap, and businesses need structured graduate and early-career programs to build future-ready teams and long-term sustainability.

Upskill for AI-enabled roles

Most NZ jobs won’t be automated, but many will be augmented. Employers should focus on practical AI tools, workflow redesign, and building comfort and familiarity with new technologies across teams.

Be realistic about salary dynamics

While wage pressures have eased, candidates remain salary-driven due to cost-of-living pressures. Competitive benchmarking and transparent ranges will help secure talent without inflating budgets.

Plan regionally

New Zealand regions are recovering at differing paces. Tailor hiring strategies, salary positioning, and timelines to local market conditions.

Moving forward

After a challenging few years, New Zealand’s labour market is finally shifting back toward growth. The recovery will be gradual, but the direction is clear. With rising candidate activity, early job ad growth, and easing wage and inflation pressures, 2026 is shaping up to be a more positive year for both employers and jobseekers.

As you plan your workforce strategy, having a clear view of market movement and salary expectations will be essential. Our online More than Money Salary Guide offers searchable rates and salaries to support confident, data-driven hiring decisions across Auckland, Wellington, and beyond.

New Zealand’s infrastructure and energy pipeline is booming but the people needed to deliver it are in short supply. With record numbers of skilled Kiwis moving overseas, and Australia’s own talent shortage intensifying, organisations here face unprecedented competition for technical and project delivery expertise.

This isn’t just a numbers issue. It’s a race for knowledge, capability, and experience.

The great Kiwi outflow

Over the past year, almost 72,000 Kiwis have relocated overseas — more than half (58%) heading to Australia. For sectors like energy, utilities, and infrastructure, this isn’t a marginal shift. Every engineer, project manager, or digital specialist leaving the workforce takes with them years of institutional knowledge and practical experience.

Even more challenging, the migration overlaps with an ageing workforce. A large portion of technical talent is nearing retirement, leaving gaps that can’t be filled by headcount alone. More than just “hiring”, organisations must think strategically about knowledge transfer, capability rebuilding, and workforce renewal.

Australia’s market pressure

Australia is facing similar talent supply issues, particularly in high-voltage energy, specialised civil engineering, and digital infrastructure. Organisations there are competing fiercely for people with Transmission Extra High Voltage (EHV) experience — skills that are scarce in both countries.

And when Australian employers can’t find talent locally, New Zealand becomes a “hunting ground” for engineers and specialists. Beyond that, consultancies are increasingly tapping Singapore, Malaysia, and the Philippines to support regional projects. For New Zealand, this adds both opportunity and risk: demand for skilled talent is now regional, not local, and competition is growing fast.

Skills scarcity isn’t sector-specific

The convergence of multiple industries competing for the same skill sets is creating a national talent pressure point. Energy, utilities, telco, transport, and water infrastructure projects are all vying for engineers, digital specialists, and project managers.

It’s no longer enough to focus on sector-specific pipelines and companies are competing across industries and borders for the people who can make projects happen. This highlights the importance of strategic workforce planning, capability development, and early talent engagement.

The opportunity: plan for capability, not just headcount

While the pressures are real, they also create an opportunity to rethink workforce strategy. Organisations that proactively capture knowledge, upskill existing teams, and design career pathways will be better positioned to navigate both the local and regional talent landscape.

By viewing workforce challenges as a strategic issue, New Zealand can move from a reactive hiring approach to building sustainable capability that ensures projects are delivered efficiently, safely, and to future-proof standards.

Learn more about the talent shaping New Zealand’s delivery future and download our Infrastructure & Utilities Snapshot for insights on workforce trends, cross-sector competition, and the skills needed to meet the country’s infrastructure ambitions.

Although it isn’t yet a tidal wave, the tide is turning on workforce planning.

In our latest AI survey with 864 business leaders and tech professionals, when asked whether AI was impacting workforce planning over the next 12-18 months:

• 12.1% said they’re already using AI to evolve roles or reduce manual work
• 23.3% said they’re exploring how AI may shift the skills they hire for
• 32.5% said it’s on their radar, but not yet a focus
• 22.9% said AI isn’t impacting their workforce planning at all

With more than a third of organisations actively exploring or implementing changes due to AI, it’s worth exploring what these changes are for both employers and candidates.

The roles rising first

According to JP Browne, Talent Practice Manager and recruitment expert in the Auckland market, “We’re not seeing a rush to hire ‘AI engineers’, but we are seeing demand for systems engineers, data engineers, and data analysts, because poor data breaks AI.”

Before deploying AI at scale within your business, you need solid data foundations. This means hiring for:

• Data quality and governance
• System integration
• Infrastructure build-out
• Security and compliance enablement

In other words, it’s those behind-the-scenes roles that make AI functional, reliable, and safe.

Recruitment reality check

AI is also changing recruitment itself, both in how candidates present themselves in the application process and how employers assess talent.

“Some candidates are using ChatGPT to craft flawless cover letters, but the actual CV doesn’t match the role. So it’s forcing recruiters to dig deeper and reintroduce more human screening,” observed JP.

We’re seeing:

• More AI-assisted job applications
• A shift away from simple keyword-matching tools
• Greater emphasis on human-in-the-loop hiring decisions

The personal productivity play

For some employees, they’re already using AI to improve their own output without waiting for top-driven organisational change.

From automating reporting to building project estimates, self-taught AI adoption is becoming a competitive edge for individuals. However, it creates uneven capability across teams, and potential risk if it’s unsanctioned.

“You can’t wait on your organisation to set the rules. You need to learn how to use AI yourself, but use it responsibly,” says JP.

Why leaders need to act now

If your workforce planning hasn’t factored in AI, you risk falling behind in:

• Skill readiness in both hiring and internal development
• Employee engagement as workers expect modern tools their industry peers are using
• Efficiency gains where your competitors will find them first
• Risk management as unsanctioned AI use is already happening

JP emphasises, “AI is here, in your phones, in your search engines, in your workflows. Ignoring it doesn’t make it go away, it just leaves you unprepared.”

The shift right now feels subtle, until it’s sudden. The organisations making small, strategic moves today will be the ones ready for the bigger shifts tomorrow.

If you need help building AI-ready hiring strategies, get in touch with our team.

Attracting top tech talent is only half the challenge for higher education. The real test is keeping them.

In a market where skilled professionals have plenty of options, retention has become just as critical as recruitment. For TA and HR leaders in universities, this means going beyond hiring campaigns and building an employee experience that tech professionals want to stick with.

Why tech talent is moving on

The education sector isn’t immune to the same pressures seen across other industries: cost-cutting, heavier workloads, and an increasingly competitive talent market. Tech specialists, whether engineers, data scientists, or AI leaders, know they’re in demand, and they’re prepared to move if their expectations aren’t met.

Three themes continue to dominate the conversation:

• Pay that keeps pace: With cost of living pressures rising, salary remains a key driver of turnover. Institutions that aren’t regularly reviewing and benchmarking pay risk losing people to private sector roles that can stretch further.
• Flexibility that’s real: Hybrid and remote work are no longer perks, they’re expectations. Universities that can offer genuine flexibility around hours, location, and responsibilities are far more likely to retain talent.
• Meaningful work: For tech professionals, impact matters. They want to know their skills are being applied to projects that excite them, whether that’s driving AI adoption, supporting world-class research, or making systems more accessible for students.

What tech talent expect in 2025

Today’s workforce wants more than a job description. To keep top performers, tertiary education institutions need to deliver on a few essentials:

• Clear career paths: Opportunities for progression, visible development programs, and clarity on how careers evolve within the university.
• Wellbeing and balance: Workloads that are sustainable, supported by wellness initiatives and family-friendly policies.
• Flexibility as standard: Hybrid models, adaptable hours, and the ability to manage personal and professional responsibilities side by side.
• Alignment with purpose: The chance to contribute to meaningful initiatives — from sustainability to research innovation to advancing digital equity.

One area where purpose and opportunity collide is Artificial Intelligence (AI). Our latest survey of higher education leaders found:

• 89% believe AI will positively impact their role in the next two years
• 53% say their institution is still at the experimental stage of adoption
• 18% are planning to hire an AI specialist or leader within 12–18 months

This presents a double challenge for retention: universities need to hold on to the digital and data talent they already have while preparing to bring in new skillsets in AI and automation.

Practical strategies to retain tech talent

It’s one thing to know what tech professionals want, the next step is delivering it in tangible ways. Here are some strategies higher education leaders can put in place to respond to the essentials of pay, flexibility, wellbeing, and purpose mentioned above:

Clear career paths

• Map out role progression for technical staff, and demonstrate how skills can transfer into leadership, research, or specialist pathways.
• Introduce mentoring programs that connect junior tech staff with senior leaders across IT, research, and innovation.
• Provide access to professional development budgets for certifications and training in emerging areas such as cloud, cybersecurity, or AI.

Wellbeing and balance

• Regularly review workloads and resource allocation to prevent burnout, particularly in lean IT or project teams
• Offer wellbeing programs that go beyond tick-box initiatives, such as confidential counselling services, wellness days, and ergonomics support for hybrid staff.
• Actively promote the use of leave and encourage leaders to model health work-life boundaries.

Flexibility that’s real

• Formalise hybrid policies that give staff clarity while still allowing room for choice.
• Invest in collaboration tools and digital infrastructure so hybrid work is seamless, not second-class.
• Consider flexibility beyond location, such as adjustable hours or compressed work weeks, to accommodate diverse needs.

Meaningful work and purpose

• Give tech professionals visibility of the real-world impact of their projects, whether improving student experiences, enabling world-class research, or advancing sustainability.
• Involve teams early in innovation projects such as AI pilots so they feel part of business or tech transformations, and not just the implementers.
• Celebrate contributions publicly through internal communications and recognition programs.

By turning broad expectations into practical actions, universities, colleges, and other higher education institutions can transform their retention strategy by creating an environment where tech talent sees a future worth committing to.

The bottom line for retention

Hiring great people is hard. Losing them is even harder. For TA and HR leaders in higher education, the focus now is building the kind of environment where tech talent can thrive long term: competitive pay, real flexibility, clear pathways, and work that feels meaningful.

At Talent, we work with universities across ANZ to not only attract niche tech specialists but retain them — reducing turnover, cutting costs, and helping institutions build the workforce they need for the future.

If you’re ready to strengthen retention in your higher ed tech teams, get in touch with us today.

TikTok has become an unlikely oracle of work culture, and the latest buzzwords have been doing the rounds: “job hugging” and “quiet cracking”. More than just social media gimmicks, they’re signals of where the labour market is right now in Australia, New Zealand, and the US.

What is “job hugging”?

A response to a tighter labour market, rising costs of living, and waves of layoffs across industries, job hugging is the latest phenomenon defined as employees holding onto their jobs for security, even if they’re disengaged.

On the surface, job hugging can look like stagnation, but employers are benefiting; fewer resignations mean lower recruitment costs and more certainty for long-term planning.

In Australia, job mobility has slipped from 9.5% in 2023 to just 7.7% in 2025, while SEEK reports job ads are down 4.8% year-on-year. It’s not surprising that many are clinging tightly to a role that feels safe.

What is “quiet cracking”?

“Quiet cracking” flips the script. It’s about employees pushing for growth in spite of limited upward mobility. This means side hustles, passion projects, or going the extra mile in their current role.

Another reaction to the broader reality, as Gallup reports 77% of people are globally disengaged at work. And when promotions or pay rises are thin on the ground, workers are finding ways to crack open new growth pathways on their own.

Gen Z and the broken entry-level market

Much of the conversation around job hugging overlaps with old narratives about Gen Zs “job hopping.” The youngest generation in the workforce, Gen Z carries a reputation for being quick to move on or staying for only 1-3 years before seeking something new.

But here’s what the headlines often miss: this isn’t about disloyalty. It’s survival in a systematically broken entry-level market.

According to Jobs and Skills Australia, entry-level jobs postings are down significantly. While in Australia, the unemployment rate is holding steady at 4.2%, the rate for young people – which is typically higher than the overall rate – has risen slightly to 9.5%.

At the same time, the pay-off for switching roles has largely evaporated. In 2023, job hoppers were gaining 7.7% salary increases compared to 5.5% for those who stayed. Now, job hoppers see a measly 0.2% gap in salary bumps of new roles offering 4.8% compared to 4.6% for those who stay put.

Candidates: Reframe the narrative

Instead of internalising this behaviour as flighty or fickle, rethink how you want to position yourself:

• Don’t apologise for being strategic. Job changes can be intentional career design. Rather than saying “I know it looks like a lot of moves,” frame it as “Each role was chosen to build specific skills for my long-term goals.”
• Skills growth over tenure. Loyalty is no longer measured in years. What matters is the growth, skills and capabilities you can point to.
• Make every move count. Random job hopping is over; strategic career construction is the new norm.

What these trends tell us about the market

Together, job hugging and quiet cracking reveal a workforce caught between caution and ambition:

• Risk aversion is high. Workers are reluctant to leave without a compelling reason.
• Retention is fragile. People may stay, but disengagement looms unless employers create pathways for growth.
• The talent pool is selective. Candidates want roles that feel both secure and has opportunity for growth, and they’ll pass on jobs that don’t offer either.

Employers: The takeaway for leaders

If you’re hiring in Australia, New Zealand, or the US, understand the balance employees are trying to strike: stability on one hand, and growth on the other. “Job huggers” need reassurance that your opportunity is safe. “Quiet crackers” need to see how it will help them grow.

In other words, you aren’t just selling a role, you’re selling everything that goes along with it: security, skills, growth, culture, and the list goes on.

Want to understand how these workforce signals could impact your hiring strategy? Our team can help you plan your next move. Get in touch.

In today’s job market, the first “reader” of your resume is usually software.

Applicant Tracking Systems (ATS) parse (read, break down, and map) your resume into structured data so recruiters can search, sort, and rank candidates fast. When the parsing goes wrong, strong applicants can get lost in the shuffle, and another caveat? Since job seekers are also using AI to game the system, we’re in a hiring landscape where both sides are optimising for efficiency, and the result is anything but.

What is parsing and why does it matter?

Parsing is how an ATS interprets your resume and turns it into searchable fields like name, job title, dates, skills, and education. If your resume formatting confuses the parser, your experience might not show up correctly in recruiter searches even if you’re highly qualified and fit for the role.

There are a few types of parsers out there:

• Keyword-based: Looks for common section headers and formats. Deviate too far and you might break it.
• AI/NLP-based: More advanced systems can extract skills and infer meaning from context but they aren’t perfect.
• OCR-based: Kicks in when resumes are uploaded as PDFs or images without a proper text layer. Accuracy here drops sharply.

For job seekers: Format for humans and machines

• Stick to 12pt fonts that every system recognises like Times New Roman, Calibri or Arial.
• Avoid design extras: Tables, columns, images, logos, and text boxes might look nice but can trip up parsing.
• Use clear section headers: Experience, Education, Certifications, Skills.
• Pack it with keywords: Think of your resume like SEO for job boards. Search “<your job> keywords” and use those in context and tie them to outcomes. Don’t list them in a block.
• Save and upload in .docx, not PDF. PDFs often require OCR to extract your text, and that’s where things break down.

As JP Browne, Practice Manager from Talent Auckland, explains:

“Some organisations are moving away from AI screening tools, because applicants can just copy-paste job ads into AI prompts and generate amazing cover letters. But if the CV doesn’t match the substance, it’s game over. Your resume has to actually contain the right data and not just sound impressive. I call it CV-for-dummies because I need everything spelled out. Don’t assume your title tells the story. Put in more detail, not less.”

For employers: Efficiency is not effectiveness

AI and ATS tools help filter thousands of applicants but over-relying on automation can hurt you. Especially in a market where candidates are leveraging generative AI to write polished CVs and cover letters, many hiring managers are finding that what looks good on paper doesn’t hold up in interview and that’s slowing the process down.

Instead of streamlining hiring, AI on both sides is creating a new bottleneck: CVs that look right but don’t deliver, and shortlists that fail to surface the best fit.

“It is not unusual for our team in Sydney to still receive 750–1500 applications per role,” says Matthew Munson, Managing Director of Talent Sydney. “Responding to this volume of applications is hard for agencies and employers and so the levels of candidate service is suffering, leading to a lot of frustration in market.”

This is echoed in South Australia by Vimal Venugopal, Senior Consultant in Technology & Project Services Recruitment in Talent Adelaide:

“Public sector jobs are seeing the highest number of applicants per job ad. According to SEEK, that index now sits at 220, and Professional Services roles are close behind at 187. That’s a huge amount of competition. This data is completely in line with what we’re observing in the Adelaide market. For example, we listed a Data Migration Analyst role and an ICT Support Analyst role and received 299 and 342 applications respectively.”

Keep a human in the loop

ATS tools are useful but they can’t replace human judgement. We recommend keeping a hiring professional involved in reviewing any final shortlist. Take a second look at ‘near miss’ candidates whose resumes may not have been perfectly formatted but show potential and revisit your role briefs and consider re-advertising with clarified requirements or alternate job titles. Most importantly, ensure interviews are being used to assess capability, not just alignment to the AI-generated CV.

Final tips for both sides

Job seekers: Format simply, write clearly, and tailor your resume for the role without ChatGPT doing all the heavy lifting.

Employers: Review your ATS setting, make sure your job ads are written clearly (without keyword stuffing), and don’t delegate shortlisting entirely to automation. The right candidate may be hiding just behind the algorithm.

If you’re a job seeker looking for your next exciting opportunity, head to our jobs board. And if you’re a hiring manager looking to find top talent who can hit the ground running, get in touch today.