If your business plan for next year still treats headcount as a set-and-forget number, the data says it’s time to revisit that. The businesses that move fastest into 2027 won’t necessarily be the ones hiring the most or cutting the deepest, they will be the ones whose workforce is deliberately matched to what the business actually needs to deliver.
Right sizing your team before the year closes out isn’t a cost-cutting exercise. It’s a planning discipline. Done well, it protects cash flow, reduces compliance risk, reduces HR risk, and frees up budget for the investments into your people, business and technology that increasingly do the heavy lifting alongside your people.
The 2027 Workforce Reality: By the Numbers
The current data paints a cautious but telling picture for small business owners heading into next year:
– Growth expectations remain modest. Recent CPA Australia research found only around one in five Australian small businesses expect to increase employee numbers this year, less than half the international survey average. Just over half expect overall business growth, again trailing the global benchmark.
– Workforce shortages haven’t eased. Industry surveys show close to seven in ten businesses expect to be affected by skills shortages, a figure that has crept up rather than improved.
– Headcount costs are structurally elevated. Compliance and payroll obligations continue to weigh on hiring decisions, with reducing payroll tax burden now ranked by many business leaders as a higher reform priority than cutting the company tax rate.
– Technology is the one investment category still rising. Roughly half of businesses surveyed plan to increase technology spending in the year ahead, the only major investment line trending upward while training, capital expenditure, and R&D budgets flatten or decline.
Read together, these numbers point to a clear pattern: businesses aren’t necessarily growing their teams, but they are investing in the systems and assets that let smaller teams do more.
The Infrastructure Wave Will Pull Skilled Workers Away From Small Business
There’s a second pressure most 2027 workforce plans aren’t accounting for, and it’s bigger than any single business’s hiring decisions.
Infrastructure Australia’s latest Infrastructure Market Capacity Report puts a hard number on a trend many small business owners are already feeling: a national infrastructure workforce shortage that sat at roughly 141,000 workers in late 2025 and is projected to surge past 300,000 by mid-2027, driven by a $242 billion five-year public infrastructure pipeline the largest since tracking began. This is on top of a wave of privately funded renewable energy, housing, and major development projects. The shortage spans:
– Trades workers and labourers – forecast to peak around 126,000 by mid-2027
– Engineers, architects and scientists – forecast to peak around 126,000 in late 2026
– Project management professionals – shortfall projected around 59,000 at peak
This matters well beyond construction and civil contracting. Government-backed and major private projects can outbid almost any small business on pay rates and guaranteed forward work, and any skilled worker with transferrable skills or an apetite to upskill will be taken by these programs. Anyone whose team includes, contracts, or competes for these skills, a project manager, an electrician, a planner, an engineer, or any role touching a major development pipeline, will feel the pull as these projects ramp up through 2027. Or feel a knock on effect from your suppliers or providers where their resources are now limited.
Queensland’s Olympics Deadline Makes It Sharper
For Queensland businesses, this pressure stacks on top of a second, tighter deadline. Construction Skills Queensland forecasts the state’s building sector will run short by more than 19,000 skilled workers a year in the lead-up to the Brisbane 2032 Games, peaking around 35,000 workers in 2027–28 as labour demand jumps roughly 17%. Government-committed Games infrastructure spending sits at $7.1 billion, with total construction tied to the event, including athletes’ villages and precinct works, expected to reach around $11.2 billion.
I put this directly to Queensland Deputy Premier Jarrod Bleijie in front of an audience of around 500 people at the Olympic Games Procurement event at Venue 114 in Bokarina, Queensland, on 28 April, challenging him on how the state actually intended to deliver with a lack of skilled workforces, current organisations unable to have skilled workers and what support the government would provide. His response was that Queensland is where people want to be, and that the state would “beg, borrow and steal” workers from elsewhere to meet Games deadlines, a line consistent with his public position on the issue. This is not sustainable nor a solution.
I don’t think that’s a workable long-term strategy, and business owners should plan on that basis rather than assume the gap will be solved for them. Pulling workers from other states doesn’t create new capacity, it relocates an existing shortage, and small businesses without the balance sheet of a major contractor or government department are the ones left short when that competition intensifies.
Practically, for any business whose staff or contractors sit in these categories:
– Expect recruitment and retention to get harder through 2027, not easier
– If you’re in or near Queensland, factor in the added pull from Games-related construction as it ramps up toward 2032
– Wage pressure won’t ease on its own – big projects set the benchmark, and smaller operators become price takers
– Finding this out when you lose someone to a bigger project is the most expensive way to learn it
The businesses that manage this well are locking in retention and succession plans for these skills now, ahead of the 2027 peak, rather than reacting once it hits.
What “Right-Sizing” Actually Means
Right-sizing gets a bad reputation because it’s often confused with downsizing. They’re not the same thing.
Downsizing starts with a target headcount and works backwards. Right-sizing starts with your 2027 demand, sales “work” pipeline, seasonal patterns, service commitments, project pipeline, and asks what capacity is genuinely required to meet it, role by role.
For some parts of your business, that will mean holding steady, or even reducing. For others, it may mean growing. And for functions increasingly supported by software, automation, or shared services, it may mean consolidating roles or redeploying people into higher-value work. The goal isn’t a smaller team. It’s a team that matches reality. However where AI is utilised ensuring your workforce has a role to audit/add human oversight is key to mitigate mistakes and poor exposure.
A Three-Part Framework for Year-End Right-Sizing
- Audit current capacity honestly
Map every role against actual output, not job title. Where is capacity underused? Where is a single person a bottleneck for the whole operation? This is the step most businesses skip, and it’s the one that produces the most useful insight.
- Map capacity against 2027 demand signals
Pull together what you already know: confirmed contracts, seasonal trends, pipeline forecasts, planned projects. Compare that against your current capacity audit. Gaps and surpluses should become obvious quickly.
- Decide what technology absorbs versus what people must
This is where workforce planning and IT asset planning need to sit in the same conversation, not separate ones.
Where IT Assets Fit Into the Plan
Given that technology is the only investment category most businesses are increasing next year, it deserves a proper seat in your workforce planning conversation , not a bolt-on decision made after headcount is settled.
A few questions worth asking before you finalise 2027 staffing:
– What is your current technology actually costing you in people-hours? Ageing systems, manual workarounds, and duplicated tools often quietly consume the equivalent of a full-time role. An IT asset audit alongside your workforce audit usually surfaces this.
– Where could a tool or system genuinely replace the need for additional headcount — not as a cost-cutting shortcut, but because it does the task better or faster than a person reasonably could?
– What is the actual role/task that needs to be delivered and what type of person do I actually need? Throughout my career I have observed hiring based on purely degrees or expertise, key experience, but is that actually needed to deliver on the work? Can you upskill? Leverage and SME for those key items only rather than a full headcount?
– Are your IT assets fit for the scale you’re planning for, or will growth in 2027 simply expose the same bottlenecks with more people attached to them?
Treating workforce planning and technology planning as one exercise, rather than two separate budget lines, is one of the clearest ways small businesses are building resilience into next year’s plan.
Your Year-End Action Checklist
Before you close out this year’s planning cycle, work through this list:
– Complete a role-by-role capacity audit across the business, and truly understand what roles and tasks are needing to be done.
– Compare current capacity against confirmed and forecast 2027 demand
– Identify any roles carrying disproportionate operational risk (single points of failure)
– Flag any staff or contractors whose skills overlap with the national infrastructure shortage, trades, engineering, project management, and build a retention plan before 2027 demand peaks
– Run a parallel audit of your core IT assets and systems
– Flag where technology investment could offset the need for additional headcount
– Model payroll and compliance costs for any planned hires, not just base salary
– Set a review date in Q1 2027, and through the year to check the plan against real numbers, not assumptions.
– This can then be the baseline for future years planning.
To remember:
Right-sizing isn’t about doing more with less for its own sake. It’s about entering 2027 with a workforce plan that’s been tested against real demand, real cost data, and a clear-eyed view of what technology can now reasonably carry, and against a national skills market that’s about to get a lot more competitive for anyone touching trades, engineering, or project delivery. Businesses that do this work before the year ends aren’t just protecting their budget, they’re giving themselves room to grow with intent, rather than reacting to gaps as they appear.
