Neil Carberry, REC Chief Executive, opened the latest REC Report on Jobs by stating, “The jobs market overall remains fairly robust, with vacancies and pay still rising and unemployment low.” This succinctly captures the essence of the data at hand. Rather than tumultuous disruptions, the dataset reveals a more subdued landscape compared to prior months, yet with promising signs fuelled by bolstered business and employer confidence. Let’s take a closer look.
Candidate availability eases making hiring decisions easier
The most recent data revealed the most pronounced surge in labour supply since December 2020. Candidate availability has steadily increased over five consecutive months, offering a reprieve to employers grappling with a tight labour market. London is experiencing the sharpest growth in the employment of temporary staff and better candidate availability, granting employers a wider talent pool to choose from.
Starting salaries continue to rise but not as steeply
Amidst concerns about the cost of living, those looking for new roles will be pleased to find salaries and temp wages continue to rise. However, the intensity of salary and temporary wage inflation is on a gentle descent, reaching its lowest point since April 2021. With this in mind, it is important to acknowledge that growth in wages remains high.
Demand for new staff continues
While a consistent surge in demand for permanent staff persists, it is the most subdued since March 2021. Conversely, the demand for temporary workers remains robust. The Office for National Statistics (ONS) reports 1,034,000 available positions in the three months leading up to June 2023. Importantly, these figures remain +25.2% higher than the pre-pandemic levels.
A broad perspective of the jobs market is vital
As anticipated, the ongoing economic uncertainties have led to a shift from the pronounced upward trends of recent years, which had created an exceptionally tight labour market.
While this shift may bring concerns for some, it's crucial to look at the future and the wider context. The post-pandemic rebound was fast, resulting in extraordinary data that was never sustainable. Yet solid growth continues, just at more realistic levels.
There are reasons for renewed optimism on the horizon. The latest REC Jobs Outlook Survey shows business confidence in the UK economy is on the up and has been for several months. Add to this, employer confidence in future hiring over the next year has climbed by five percentage points, reaching a net +7. The CBI and the latest Bank of England projections also predict employment growth in the not-too-distant future.
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