It’s easy to get caught up in the doom and gloom of widespread media reports about the state of the nation when considering the labour market. It’s true that things are becoming increasingly challenging, but it’s important not to get lost in the media angst, and instead focus on where opportunities for growth lie.
Business confidence has fallen 3% since the previous quarter, but it’s not time to throw in the towel! Your talent is essential for success and knowing how to secure that talent in the current market is essential. Central to this is understanding why the recruitment market looks like it does.
Here we look at the latest news from the recruitment industry, with data taken from the REC/KPMG Report on Jobs.
Fall in permanent placements
The number of permanent placements has fallen for the first time in 20 months and this is combined with a stagnation in temporary numbers too. What this reflects is the intense uncertainty experienced by businesses in the last few months, most likely due to the political and economic turmoil we’ve witnessed. The rate of contraction we’ve seen in permanent placements is the most marked we’ve seen in 21 months. It’s natural that employers pull back on the reins of recruitment at times of uncertainty, but it’s not always the right call for business survival and growth.
Vacancy growth continues but eases
In October, we saw increased demand for staff overall, yet again. This shows that employers are committed to finding the staff they need. That said, the rate of demand eased with the weakest growth seen since February 2021.This is represented in a drop in the total number of vacancies in the 3 months to September being recorded by the ONS at 1,246,000. However, it should be noted that this is still 10.4% higher than a year previously.
Candidate availability takes a hit again
Candidate availability has been a problem for a while and October saw another sharp drop, even though this represented the slowest fall since April 2021. This is particularly notable for permanent staff. Availability of permanent staff has now fallen for 21 months in a row. Candidates are loathe to move amidst uncertainty and with low unemployment rates, this is as expected. The North of England has seen the quickest drop in candidate supply.
Salary inflation is easing
Salaries and wages had been rising sharply. This remains the case but looks to be softening, with salary inflation at the slowest rate for 18 months. The cost of living crisis continues to put upward pressure on starting pay, however. The ONS revealed that employee earnings were 6% higher than a year previously, but this is predominantly reflecting the private sector.
The recruitment market is again facing an unusual time. The pandemic led to unusual levels of economic inactivity and moving forwards from here requires recruiters to work to raise candidate confidence and numbers in order to meet the demands of the UK economy as we enter recession.
As Neil Carberry, Chief Executive of the REC says,
“Activity, overall, is still well in advance of pre-pandemic levels.”
Nonetheless, we need to work hard to bring the support and encouragement to the labour market that’s needed in a climate of understandable caution.
As always, we are here to help with your recruitment needs.
#REC #KPMG #JobsOutlook #Recruitment #ExecutiveRecruitment #UKMfg #UKManufacturing #BusinessLeaders
We publish an overview of the REC/KPMG Jobs Outlook Report each month to keep you up to date with the UK recruitment and jobs market month by month.
Contact us today if you need specialist support to secure your future senior level workforce in Engineering/Manufacturing.
Follow us on LinkedIn, Twitter and Facebook for regular articles, reports, videos, guidance and support relating to recruitment for businesses and individuals.