KPMG/REC Jobs Outlook Report – October 2020
It would be easy to have a kneejerk reaction to the latest reports on the state of the jobs market. However, we need to look at this data realistically, within a wider context.
We cannot escape that the economic impact of Covid-19 is tough, but we also need to look at the recent evidence that when restrictions were loosened, the jobs market bounced back better than expected.
Therefore, whilst the most recent data from the REC’s Report on Jobs paints a harsh picture, when we look at wider trends, there is room for optimism.
October in a nutshell
The main findings for October highlight that permanent roles have dropped after two months of growth. This reflects the greater impositions due to growing Covid case numbers, the anticipation of another lockdown and its subsequent announcement.
Whilst temporary jobs have once again stepped into the void, the overall number of jobs available has dropped in October.
In addition, the greater numbers of people looking for work means that starting salaries have reduced. This applies for both permanent and temporary jobs.
The wider context
Whilst permanent vacancies have reduced, we need to remember the UK’s flexibility. Temporary jobs have continued to increase sharply. As such, we cannot look at the situation with permanent roles in isolation.
The UK is adept at using temp roles when things look uncertain, and this has seen us through many challenging times in the past.
We also need to remember that over the summer, when restrictions were eased, the labour market demonstrated its immense ability to bounce back with the Recovery Jobs Tracker visually painting a picture of speedy recovery.
Optimism grew quickly. We need to have faith in employers that they don’t remain lacking in confidence once a threat begins to ease. They respond quickly and positively. We can expect the same again once cases are brought under control.
The winter ahead
We do need to be braced for the winter ahead. It’s not going to be easy. Recruiters will be essential for enabling talent to transfer from areas of contraction to areas of growing demand, transferring their skills as needed.
We also need to remember that this time, businesses are more prepared. There isn’t the shock element of the last lockdown. As Neil Carberry, Chief Executive of the REC says, “… we believe that firms are better prepared to trade through these new restrictions than they were in March.”
Of course, it is the hospitality sector that is once again being hit particularly hard, whilst there is actually growth in IT & computing, engineering, nursing care and accountancy.
The extension of the furlough scheme until March 2021 gives both employers and employees some breathing space. It’s cold comfort to those who have already faced redundancy, but it should mean that candidate availability won’t be as swamped as it could be, making it easier for those looking for new jobs than it would otherwise be.
We can’t expect redundancies to stop completely, but hopefully this will result in a gentle stream of jobs losses rather than a breaking dam.
What’s more, we can look to the North as an interesting example of how resilient we are. Facing much tighter restrictions in advance of the rest of England, they are actually already showing signs of strength.
Be cautious, but not negative
Overall, everyone from employers to candidates, need to be careful not to be too negatively reactive to what are understandable sharp changes in October. We’ve seen how we can weather them and optimism will be an important tool for all of us.