Employment Hero’s April jobs report reveals a labour market that is resilient but shifting fast toward flexibility over full-time commitment.
Something shifted in the way Australian businesses approached hiring in April. After three consecutive months of workforce expansion, employment growth stalled, dipping to -0.1% month on month according to Employment Hero’s latest Jobs Report.
It is a small number but a meaningful signal from a dataset that covers more than 23,000 businesses and 1.7 million employees across Australia, one of the most comprehensive real-time reads on the Australian labour market available.
The stall does not mean businesses have stopped hiring. Annual employment growth remains solid at 8.4% year on year, continuing an upward trend that has been building since late 2025. But the monthly pause, combined with a sharp acceleration in casual employment, tells a story about how small and medium-sized businesses are responding to a more difficult operating environment.
What the April numbers show
The April Jobs Report captures a labour market that is resilient at the annual level but increasingly cautious at the margins. Businesses that were expanding their workforces rapidly through 2024 and early 2025 are now taking a more measured approach, weighing each hire against a backdrop of rising operating costs, the RBA’s third rate rise of 2026, and ongoing uncertainty about consumer demand in the second half of the year.
James Keene, APAC Managing Director at Employment Hero, describes the shift as a deliberate recalibration rather than a retreat. “Businesses are still hiring, but the pace of growth has clearly slowed as employers become more cautious about expanding their workforce,” he says. “After several years of rapid hiring and intense competition for workers, many businesses are now focused on protecting margins, managing costs carefully and building more flexibility into their workforce models.”
The casual employment shift
The most significant structural story in the April data is the divergence between casual and full-time employment growth. Casual employment grew 11% year on year in April, more than double the 5% growth rate for full-time employment and well ahead of part-time at 2.9%. That gap has been widening consistently across recent months and reflects a deliberate strategic shift rather than a short-term response to any single pressure.
For SME owners, the logic is straightforward even if the implications are complex. Casual employees provide flexibility to scale the workforce up or down as demand fluctuates, without the fixed cost commitment of a full-time hire. In an environment where consumer confidence is soft, input costs are rising, and the economic outlook is uncertain, that flexibility has real value. “The continued strength in casual employment highlights that employers still need access to talent, but they increasingly want the ability to scale workforces up or down depending on demand,” Keene says.
The flip side for SME owners is that a predominantly casual workforce carries its own costs and risks. Casual employees typically command a higher hourly rate through the casual loading. They are less likely to develop deep institutional knowledge. And the Deputy Big Shift Report we covered earlier this month found that workers in unpredictable casual arrangements are significantly more resistant to new technology and change, which has direct implications for businesses trying to introduce AI tools or new systems. The choice between casual flexibility and full-time commitment is not straightforward, and the April data suggests many businesses are still working out where the right balance sits.Wages keep climbing
While hiring growth stalled, wages did not. April recorded the strongest monthly wage increase in more than six months, rising 1.6% month on month. Annual wage growth sits at 4.8% year on year, above the current inflation rate, meaning workers are continuing to see real wage growth despite the cost of living pressures hitting their household budgets from multiple directions. Median hourly wages nationally now stand at $46.30.
For SME owners, the wage picture creates a specific tension. Rising wages are good news for attracting and retaining people. They are also a direct cost pressure on businesses whose margins are already being squeezed by fuel prices, input costs, and interest rates. “Wages are continuing to rise, which is positive news for workers, but it also adds to the cost pressures many businesses are already carrying,” Keene says.
The timing adds another layer of complexity. Payday Super arrives on 1 July, requiring employers to pay superannuation at the same time as wages rather than quarterly. For businesses running tight cashflow, that change in payment timing will interact directly with wage levels. A workforce that is both more expensive per hour and requires super paid more frequently is a cashflow planning challenge that every small business owner with employees needs to have modelled before the end of June.
What this means for SME hiring decisions
The April data points to a hiring environment that rewards deliberateness over speed. Keene describes the shift in how businesses are approaching workforce decisions. “We’re seeing employers become increasingly strategic about hiring decisions and more focused on workforce efficiency and productivity. Rather than aggressive expansion, businesses are taking a more disciplined approach to growth in the current environment.”
For SME owners, that translates into a few practical considerations. If you are considering a full-time hire, the current environment makes the case for being very clear about what the role needs to deliver before posting it. If you are using casual staff to manage flexibility, the Deputy and Employment Hero data together suggest the workforce experience you create for those workers will determine how productive and engaged they actually are. And if wages in your sector are running at or above the 4.8% annual growth rate, that benchmark matters for both retention and recruitment conversations.
The annual employment growth figure of 8.4% year on year is the number that puts all of this in perspective. Australian businesses are not retrenching. They are recalibrating. The question for every SME owner heading into the June quarter is whether their own workforce strategy reflects where the market has moved to, or where it was twelve months ago.
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