Jobs Outlook Report – May 2022
The news on the ground remains that it is an excellent time to be looking for a job with vacancies continuing to rise month on month. It’s a tougher picture for employers. They need to work closely with expert recruitment businesses to find the right candidates in a time of record low unemployment and high numbers of economically inactive people following the pandemic.
Rounding up the latest information from the REC’s Report on Jobs we can bring you the following insights.
Hiring activity is busy but softening
There’s a great deal of movement still in the recruitment market, and May was characterised by further strong increases in recruitment across the country. However, there remain early indications that the brakes are gradually being applied, with the number of people being placed into permanent roles increasing at the softest rate since March 2021. This is most likely driven by candidate shortages.
Candidate shortages are driving difficulties
Candidate supply continues to pose significant and growing problems for employers. The rate of reduction was actually the softest for four months but this is little consolation as the decline in candidate supply is still continuing apace. It’s particularly notable for permanent workers. As explained previously, candidate shortages are most likely driven by skills shortages, caution over the wider market and a reduction in overseas workers.
There have now been 16 consecutive months of decline in the number of permanent candidates.
Vacancies continue to expand sharply
The Office of National Statistics (ONS) revealed there were 1,295,000 vacancies in the UK in April 2022 which is, yet again, a record high. Demand for workers continues to rise and applies to all sectors. Vacancies are more notable in the permanent sector compared to temporary jobs. Vacancies have now been rising for 16 months. However, the latest increase is actually the softest we’ve seen since February.
Starting pay is high and getting higher
The above pressures continue to force starting pay upwards, for both permanent and temporary jobs. Again the pace of increase has softened slightly compared to recent months, but it is still very marked, with salaries given to permanent starters being up for the fifteenth month in a row. This is inevitable in the face of severe competition for candidates and skills.
The North of England has seen the strongest rise in temporary jobs overall.
This information from the Report on Jobs is backed up by data from the ONS which shows that employee earnings (including bonuses) rose +7.0% year-on-year during the first quarter of the year.
As Neil Carberry, Chief Executive of the REC, said:
“These numbers show a hugely positive jobs market if you are looking for work. While the pace of growth has dropped after a stellar first quarter, by any normal measure there are still lots of vacancies out there, offering improved wages.”
For individuals, it’s an excellent time to secure new roles with better pay to help with the cost of living rises.
For employers, moving away from the old ‘transactional’ relationship in order to build a closer and more collaborative partnership will make a huge difference to your business’s recruitment needs.