Recruitment Friction Fuels Australia’s ‘Lost Jobs Economy’ as Unfilled Roles Cost Aussie Businesses Millions

• New Employment Hero research reveals 67% of Australian workers are open to a new role, but only 6% are actively applying.
• More than half (55%) stay in current roles because finding a new job feels “too difficult, time-consuming or uncertain”.
• 52% say relevant jobs remain “hidden”, leaving willing workers on the sidelines, while 78% of businesses report losing revenue due to unfilled positions.

Sydney, Australia, 15 September 2026 – A costly disconnect in the Australian labour market is fueling a ‘Lost Jobs Economy’, with friction in traditional hiring processes leaving millions of willing workers on the sidelines while businesses lose critical revenue to long-term vacancies.

New research from employment platform Employment Hero reveals a massive gap between job opportunity and candidate action: while 67 per cent of employees say they would consider a new role aligned with their skills and salary expectations, just 6 per cent are actively applying for work.

The findings highlight a workforce held back by hiring friction, with 55 per cent admitting they stayed in their current job over the past 12 months simply because finding a new one felt too difficult, time-consuming or uncertain. Furthermore, 52 per cent feel they are missing out on suitable roles because opportunities are hidden, hard to find, or never reach them.

Employment Hero Managing Director, Talent, David Holland, said traditional hiring models are failing to connect employers with the talent that already exists.

“For decades, recruitment has relied on candidates proactively spending their spare time searching for jobs, tailoring resumes and navigating lengthy application processes,” Mr Holland said. “Today’s workforce behaves differently. Millions of workers are open to a better opportunity if it lands in front of them, but the sheer friction of traditional job hunting keeps them on the fence.

“We have employers desperately searching for staff and millions of Australians open to moving, but because the two sides aren’t connecting, both businesses and workers are missing out.”

This recruitment friction is having a severe knock-on effect on Australian businesses. The data shows 48 per cent of employers acknowledge the talent they need exists in the market, but candidates simply aren’t applying through traditional job boards.

Among businesses facing hiring challenges, roles sit vacant for an average of 5.8 months, forcing remaining staff to carry higher workloads, reducing customer service levels and delaying business growth. Over three in four employers (78 per cent) report losing revenue due to unfilled positions, with 16 per cent taking a hit of $250,000 or more over the past year.

Employment Hero estimates this could equate to approximately $160 million* in lost revenue for every 1,000 businesses, based on conservative assumptions drawn from the research.

“When vacant roles sit open for months, it ceases to be just a hiring problem; it becomes a broader national productivity problem,” Mr Holland said. “It means existing staff burn out carrying extra work, growth plans get put on hold and local businesses lose real revenue.

“We need to make connecting employers and workers far easier. The future of recruitment relies on taking the effort out of the process, matching passive talent with open roles seamlessly so businesses can fill vacancies faster and workers can discover their next move without the hassle.”

To bridge the gap between open roles and passive talent, Employment Hero has launched the Recruitment Agent, a hiring solution powered by Employment Hero intelligence and data designed to identify, match and connect employers directly with qualified candidates who might otherwise remain outside the active hiring pool. By automating candidate matching and screening, the technology removes traditional friction to help unlock the growth currently being lost to Australia’s ‘Lost Jobs Economy’.

*Revenue-loss estimates are based on midpoint values assigned to survey response ranges and weighted according to respondent distribution. Responses indicating no revenue loss or uncertainty were assigned a value of $0. Responses indicating revenue loss of more than $1 million were assigned a value of $1.25 million. This approach produces an estimated average annual revenue loss of approximately $160,000 per business due to unfilled roles, equivalent to around $160 million per 1,000 businesses.