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Increasing headcounts and satisfied employers: August 2018’s Labour Market Report
Posted Date: 13/09/2018 17:02:57
The August edition of the REC’s JobsOutlook report has revealed that, in spite of a fall in confidence by employers confidence in the prospects of the UK economy, hiring heads are planning to increase both their permanent and temporary headcount in the short- and medium-terms.
However, the report has also highlighted that two thirds of hirers are concerned over the availability of agency workers. Despite the shortage, just over three-quarters of UK employers have expressed satisfaction with the recruitment agencies that they have used in the past two years!
In the short-term, 67% of permanent hirers in the UK were wanting to hold their permanent headcount at its existing level over this quarter, a sharp decrease in points from 74% a year previously. However, in those wanting to increase their numbers (26%), there was a notable 8 point upswing year-on-year. With regards to the medium-outlook, 61% of hirers want to hold their permanent numbers, 10 points lower than last year. Conversely, as with the short-term, there was another increase in those wanting to increase their permanent headcount: now at 27% from 18%.
When asked, ‘In the next 3 months, do you think the number of temporary agency workers in your organisation will increase or decrease?’, hiring managers agreed that it would increase. 35% of hirers, however, were looking to add to their headcount but with only 30.1% looking to ‘increase slightly’. This was also the casewith medium-term hiring, with hiring managers also expecting demand to increase. The proportion of hirers wanting to increase their headcount increased to 35% from 18%, nearly doubling from the previous year.
The UK Labour Market
The UK workforce increased by 42,000 workers compared to last quarter and 313,000 workers, a 1% increase, compared to this time last year. However, the number of temporary employees fell by 25,000 on from last quarter and 15,000 from the same period last year.
Amazingly, the unemployment rate fell to 4% in the second quarter of 2018, representing the lowest level of unemployment since December 1974! However, unemployment rates in the 25-49 age bracket has risen by 7,000 people this quarter.
Regardless of the lowering unemployment rate, 50% of permanent hiring employers and 66% of agency hiring staff are concerned about the availability of workers with the latter nearly double the amount of concerned hirers (34%) last year. This is mostly concerned with the construction industry for permanent placements and office professionals and marketing, media and creative professionals for temporary roles.
The proportion of employers using recruitment firms to source permanent or temporary workers continues to increase: At 48% and 58% of hirers, permanent and temporary respectively, both have increased compared to the year previously with figures of 40% and 45%. However, recruitment agencies have yet to trump the most popular method for finding workers, which is references via former employees or asking around.
In response to this increase, what factors play a part in choosing a recruitment agency? The priority for hiring managers is quality of service, closely followed by the price/cost of workers in second place and then agency expertise in terms of regions and sectors covered.
Despite the concerns of high quality talent in the UK, 77% of employers using a recruitment agency have been satisfied with the candidates brought to them. This is a decrease from 83% last quarter but up from 73% in this period last year.