Current Labour Market Conditions – October 2021 Update
Growth in job adverts continues from September into October. In a press release from the Recruitment and Employment Confederation (REC), it was announced that, in the week commencing 4th October, there were 2.29 million active job adverts in the UK. The Jobs Recovery Tracker notes this is a new record high, and that “in the same week there were around 235,000 new job postings – the second highest weekly figure since data collection began”.
As the nation ramps up production, supply and services for Christmas, the increase in job adverts reflects the need to keep up with demand but are the jobs being filled? Neil Carberry, Chief Executive of the REC, says that now is a great time to be looking for a job. Competition between companies is fierce, with many increasing salaries and benefits to attract the staff they need. However, John Gray, Vice President, UK Operations at Emsi Burning Glass points out that the media and information gathered from employers indicated that actually hiring people has become increasingly difficult.
What reasons are there for this lack of candidates? In a recent REC survey on skills shortages, recruiters from around the UK highlighted the factors affecting ability to place suitable candidates.
As you can see in the image below, the biggest issue is a lack of candidates with the right skills for where demand is currently highest. When the lockdown and pandemic threw plans to the wind, companies tightened budgets and changed priorities as expected, but this may now be affecting their ability to offer competitive salaries. The change in the current immigration system too, might be contributing to less of the right skilled workers for demand, or the acceptance of less competitive wages.
Furthermore, the survey found that 88% of recruiters feel labour shortages are their biggest concern throughout the rest of 2021, which is more to do with the quantity of candidates than a lack of skilled candidates.
In response, recruiters have “adapted their operations to respond to the fluid demand of the pandemic” and the survey shows that almost half of recruiters have simplified their recruitment processes and increased salaries to cope.
To raise awareness and implement solutions quickly, the REC have asked the government and businesses for help. They have set out the following demands to address the crisis:
- Set up a new cross-government and industry forum including BEIS, DfE and DWP.
- Allow flexibility in the points-based immigration system and a visa route for low skilled workers.
- Broaden the apprenticeship levy and increase funding for training at lower skill levels.
- Increase focus from businesses on workforce planning, staff engagement, attraction, and retention policies.
The aim of these solutions is to alleviate the issues currently and prepare and plan for mitigating them in the future. With the government listening to, and planning with, industry experts such as recruiters, the economy can only benefit and flourish.