The human resources start-up, which was last valued at more than $1 billion, has launched an AI hiring tool called Swag.
Employment Hero’s CEO and co-founder, Ben Thompson, says Swag will give small-and-medium-sized enterprises (SMEs) a leg up in the war on talent – a battle they’re currently losing due to record-low unemployment (currently 3.7% in Australia) and an inability to match the wage hikes of big corporates.
The new “superapp” leverages artificial intelligence to streamline the recruitment process. For example, it can use AI to produce first-draft job descriptions, predict a business’ future hiring needs, match eligible candidates with suitable roles and post jobs to job boards.
The Swag Career feature gives job seekers access to a free jobs board called Swag Jobs, where they can create a digital employment passport to view job ads. SMEs get free access to these applicants without posting or advertising costs, directly in competition with one of Employment Hero’s backers, SEEK. Businesses that work with Employment Hero – including those on its freemium tier – get Swag included.
“Our SME base has repeatedly told us that record-low unemployment rates are making it extremely difficult to find, attract and retain the talent they need to grow their business,” Thompson says.
“And with interest rates rapidly rising, more and more businesses are walking a fine line when matching throughput with overheads.”
That still doesn’t necessarily address the fact that SMEs can’t match wage hikes – but Swag claims the solution is “corporate-level benefits” that are inbuilt in the app. For example, Swag offers employees free access benefits that they can pass onto their staff in lieu of wage hikes, like a credit-free earned-wage access tool called InstaPay or a Swag Spend account that offers up to 20% cashback offers from Gen Z-favourite brands like Adore Beauty and The Iconic and up to 4.5% off everyday purchases from brands like Uber Eats and JB Hi-Fi.
On the earned-wage tool, Thomspon says it’s designed to prevent Australian workers from using credit or incurring late fees – it’s the employee’s own money paid on-demand from what they’ve earned so far in that pay cycle. It does cost $3 to $4 per release and employees can only access a maximum of $250 per week. Thompson says Employment Hero received independent legal advice to support the view that InstaPay is not a loan and therefore Employment Hero is not a financial services business.
“While salary is a motivating factor, it’s not the only reason someone takes a role. In fact, recent Robert Half research shows that 63 per cent of Australian employers had had a candidate accept a job offer because of the benefits package they offer, even when they were unable to meet their salary expectations,” Thompson told Forbes Australia.
“Obviously wages are a large contributing factor to whether a jobseeker accepts a role or not – but with inflation and a slowing economy stretching many SMEs thin, it’s difficult for them to match the budgets that bigger corporates can pay for a role. Benefits play a crucial part in an attractive employee offering: they show that a business is committed to supporting their people, offering rewards and recognising great work.”
AI and the HR industry
With an estimated value of US$5.26 billion in 2023, going up to US$10.7 billion by 2028, the global artificial intelligence in the HR market is rising rapidly with a CAGR (compound annual growth rate) of 15.3%.
Employment Hero’s Thomspon says it’s “nothing short of a game-changer”, particularly for SME HR teams, who can now identify high-potential candidates at a glance.
“The fusion of AI and HR not only boosts efficiency but also fosters a culture of innovation, where data-driven decision-making and human intuition intersect, shaping the future of work,” he says.
Employment Hero also has a three-phase plan to incorporate AI into the foundations of its product and business. Currently, it’s in phase one, where it’s adopting AI to streamline “tedious” parts of the job search like writing job descriptions.
“In future, we’ll use AI to match suitable candidates to promising job openings before an employer has even advertised a role on a job board. We’ll be able to predict a business’ future hiring needs based on past growth, and streamline each step of the recruitment process to get the right person in the right role, faster.”