While the number of people in work in the UK reaches record highs, employment experts warn the supply of workers risks reaching breaking point. Figures from the Office of National Statistics released this morning reveal the number of people in work has reached a record high of 32.5m.
While there was also an increase in unemployment – up 8,000 between September and November to 1.3m – the unemployment total is 68,000 lower than at the same point last year, with the jobless rate 0.2% down on the corresponding period in 2018 and the number of job vacancies at their joint highest level since 2001.
The number of people defined as economically inactive fell by 100,000 to 8.6m, a rate of 21%, the lowest rate on record. Meanwhile average earnings excluding bonuses rose by 3.3% in the year to November, with wage increases continuing to outpace inflation.
Commenting on the figures, Pawel Adrjan, UK economist at the global job site Indeed, claims the supply of available workers now risks being stretched to breaking point: “With unemployment falling again – this time to a 44-year low – there simply aren’t enough jobseekers to keep up with demand. That’s why the number of unfilled vacancies is creeping up.
“The problems are being exacerbated by Britain’s waning appeal to European workers. Migration data shows EU citizens are leaving the UK at the fastest rate for more than two decades. As other European economies pick up steam and the weak Pound and Brexit uncertainty weigh on Britain’s appeal, more EU workers are finding more reasons to look for work elsewhere.
“The net effect is a surplus of jobs that cannot be completely filled. While in the short term this is propelling wages upwards as employers fight to attract talent, in the longer term they will need to tap into underutilised sources of workers like single parents, people with disabilities and ethnic minorities too.”
Meanwhile Kay Cooper, managing director of RPO for EMEA at global executive search firm Korn Ferry, says with employment in the UK at a record high, organisations that want to boost headcount will find themselves in a competitive job market.
“Business leaders need to think carefully about how they can attract and retain the best talent. From flexible working schemes for a better work-life balance and increased holiday allowance, to robust career development programmes and creative working environments, employers need to offer something more. While some believe monetary rewards are the key factor, creating meaningful work can be just as important.”
Commenting on how client demand for their services has fared, David Morel, CEO of PA and secretarial staffing specialist Tiger Recruitment, said while the agency had seen demand from larger organisations hold up, the same could not be said for demand from SMEs.
“Although we would usually expect to see businesses take on more temps at times of uncertainty, in this case it appears that smaller businesses are trying to cut short-term costs and increase their cash reserves in preparation for a ‘no deal’ Brexit.
“The fact that permanent roles have been unaffected – in fact, we saw a 40% year-on-year increase in permanent roles in December – indicates that businesses aren’t putting their longer-term plans on hold just yet. And with candidates still happy to move roles, the market remains relatively buoyant. However, concerns are probably at the highest level I’ve seen since the Brexit vote – and set to rise if some clarity isn’t provided soon.”
Meanwhile Recruitment & Employment Confederation (REC) director of policy, Tom Hadley, said despite the ongoing political turbulence, employers are continuing to hire: “Today’s data shows a joint-record number of vacancies, underlining the fact that the supply of staff remains a major challenge and a threat to business growth.
“Reassuring people from the EU working across a range of sectors in the UK must remain a priority, with yesterday’s announcement by the PM to scrap EU citizens’ settled status fee sending out a much needed positive message.
Source - Recruiter.co.uk
“However, the politics play out over the coming weeks and months, employers will need to continue innovating in how they hire and attract staff to fill vacancies. Recruitment professionals will play a pivotal role in finding new ways of meeting workforce challenges in high-demand sectors, ranging from engineering and healthcare to hospitality, construction and logistics.”
Source - Recruiter.co.uk