The economic uncertainty and the cost-of-living crisis continue to dominate the landscape.
The latest data for Yorkshire & Humber shows candidate availability falling further as workers stay put in their current roles and low employer confidence shows no signs of improving in the midst of a recession.
Neil Carberry, Chief Executive of the Recruitment & Employment Confederation (REC) said: “The challenges we see in today’s data reflects the underlying shortage of Labour the UK faces. With unemployment at record lows, pay continues to rise for both temporary and permanent workers starting new jobs, and activity levels across the recruitment and staffing industry remain high. While any economic slowdown this winter will affect the market, the extent of shortages mean that hiring will remain a focus for employers.”
Staff appointments and vacancies
There has been a renewed increase in permanent staff due to a slight pick up in skilled candidate availability. On the temp side, billings rose at a strong pace – the fastest of the four monitored regions in the UK. The data highlights a particularly buoyant market for temporary workers as we see companies prefer this option rather than permanent recruitment solutions.
The data shows slow vacancy growth in September with both permanent and temporary vacancies growing at the weakest rate since February 2021.
Availability for permanent staff has fallen at the quickest pace in the last three months continuing to decrease in September. In addition to this the extent to which the labour supply has fallen is the worst of the four monitored regions. The data suggests that there is a strong reluctance for workers to change jobs in the current economic climate.
There was also a soft decline in the supply of candidates for temporary positions as agencies indicate a lack of skilled workers in the candidate pool.
Demand for skills
Accounts and finance, engineers, blue collar (drivers, electricians and manufacturers) and professional (marketing, HR and legal) were highlighted as key areas in which the skills shortages are having a serious impact.
Pay pressures and inflation
The latest data from the Office for National Statistics (ONS) signalled that average weekly earning across Yorkshire & the Humber rose by 8% on an annual basis to £628 during the second quarter of 2022 (UK average is 7.7%).
The Bank of England stated that they expect the inflation rate to peak at 11% in October and then remain above 10% for a few months before starting to come down. We believe there is a long way to go to reach the 2% inflation target in the next two years particularly because for the most part it is out of our control.
Higher energy prices are the main reason why inflation is currently so high, with Russia’s invasion of Ukraine leading to a huge increase in the price of gas. By August this year, UK domestic energy bills had already risen by 73.2% compared to a year ago. This has a knock-on effect as UK business charge more for their goods and service because of the higher costs they face.
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