Grant Nichol, Managing Partner, Australia
Suggestions For Success When Hiring in Extremely Tight Candidate Markets: Learnings from the Infrastructure Sector
The Australian infrastructure sector is currently experiencing unprecedented levels of demand and extremely limited supply. Most organizations simply cannot find the leaders they need, but good hiring results can still be accomplished, particularly for those with a pragmatic and resourceful approach.
Post-COVID, infrastructure spending in Australia skyrocketed, with a total of AUD$255 billion (USD$169 billion) committed by state, territory, and federal governments through to the end of the 2025-2026 financial year. On a per-capita basis, this equates to $9,842 (USD$6,527) being spent per person on development projects across the next three years, one of the highest in the world. Australian Federal Government allocations to infrastructure have now increased 91% since the 2019-2020 Budget.
Australia's investment in infrastructure projects is driven by the need to support population growth, enhance urban and regional development, upgrade aging infrastructure, improve resilience to natural disasters, and prepare for future needs and advancements.
However, as the country bounced out of the setbacks associated with COVID, infrastructure spending also became a strong economic stimulus tool, as well as a political tool, to win favor with both voters and businesses.
As a result, the Federal Government, individual states, and territories are all frenetically competing for the best executive talent to lead these projects. Victoria, New South Wales, and Queensland have more resources and funding than the less populated states and territories. Building Authorities that are overseeing works, and private construction companies who have won bids for work, are also competing for talent.
Considerable hyperinflation of salaries has become a feature that is showing no signs of abating. From our extensive work with clients throughout the sector, the roles that are particularly in demand now include executive project-lead (Director) roles, and Program Heads. Adding to the already tight supply are clients’ often strong preference for appointees to relocate to the project’s city, town, or region.
The complexity and know-how required to successfully lead infrastructure/construction projects within a particular subsector can often require specialist experience, which also limits the candidate supply. For example, complex health and critical care infrastructure often requires specialist experience/knowledge in that sector.
Infrastructure Australia’s strategic 15-year rolling plan calls for a continued uplift in spending to cope with the country’s forecast population of 31.4 million people by 2036 – an increase of 23.7%. Another priority is natural disaster mitigation strategies: the average annual cost of natural disasters is projected to rise from AUD$18.2 billion (USD$12.1 billion) this year to AUD$39.3 billion (USD$26.1 billion) in 2050.
Even in this market, however, organizations that are resourceful, creative, and pragmatic in their approach can secure top-tier infrastructure leadership.
The following suggestions are useful for both government and private sector organizations when searching for senior executives in extremely tight and hyperinflated candidate markets.
Understand the Realities of the Market
When undertaking a search in an extremely tight and competitive labor market, accept that macro-factors beyond your control will have some impact on the outcome, including the type of candidate/skills level you are able to secure, or the compensation needed to secure that candidate, or sometimes a trade-off between the two.
Become knowledgeable about how tough the search for a particular role is expected to be, by looking at a range of data. Request this intel from your executive search firm if you are working with one. The more knowledge you can attain the better. Insights around hiring rates, salary increases, and candidate expectations will also provide opportunities for mutual alignment and understanding when negotiating a package with your preferred candidate.
Separate Your ‘Must Haves’ from Your ‘Good to Haves’
Create your ideal candidate profile: what skills they should have, their attributes, where they will be located, their occupational experience, and their cultural fit. Then, using your knowledge of the current hiring market, spend time scrutinizing these criteria.
Develop an understanding of what is essential, what is a nice to have, and what can be jettisoned. What traits are you willing to negotiate or move on? What is the essence or the core of this role that will make this appointment successful - is relocation absolutely required, or would weekly FIFO (fly-in, fly-out) work?
This is not about getting someone who is not qualified for the role. This is about contextually defining the profile of an excellent candidate, and developing an understanding of what elements or features of the hire that are not quite so important. Don’t let the perfect get in the way of the good.
Be Both Creative and Compelling in Your Proposition
Craft the opportunity in a way that is compelling to passive candidates, and be both bold and creative in your proposition. Elements that are particularly attractive to senior candidates in a tight market include succession pathways, workplace flexibility, competitive compensation packages, and cultural/brand alignment. Some strategic differentiation from competitor organizations can be important.
In a once-in-a-generation tough hiring market, there are only two outcomes at play: a hire, or no hire. Success takes organizational fortitude, maturity, ingenuity, and sometimes a willingness to compromise.
Despite the very strong headwinds in the Australian infrastructure sector, where executive talent is in critical demand, the likes of which we have never previously seen, NGS Global is proud of our track record in continuing to achieve exceptional results for our clients. These great hiring outcomes have a great deal to do with the client-side tactics listed above, as well as the utilization of our deep and extensive senior network, our decades of experience in the sector, and our customized candidate research and partner-led proposition pitch practices.