Employment demand at strongest level in six months

UK employment activity continues to remain strong, despite recent political upheavals that many experts believed would create tension in the market.

In fact, data from the Recruitment and Employment Confederation (REC) and the Office for National Statistics (ONS) indicate demand may be at its strongest for some time.

The latest REC’s monthly Report on Jobs, compiled in conjunction with Markit, showed growth in permanent placements jumped to eight-month highs. Meanwhile, the level of demand for both permanent and temporary workers reached levels not seen since May.

October was the third month in a row that the number of people securing permanent placements climbed, and there was further good news for jobseekers as available vacancies also rose.

ONS figures echo REC findings

Soon after the REC-Markit report, the ONS confirmed that national employment figures improved over the June to September quarter, with 31.8 million people in work over the three-month period. This was 49,000 more than in the previous quarter and 350,000 higher year on year.

Significantly, the employment rate – which measures the proportion of people aged between 16 and 64 who have a job – was at its joint highest level (74.5 per cent) since 1971. Unemployment dropped from 5.3 per cent of the population to 4.8 per cent – its lowest level since 2005.

REC director of policy Tom Hadley said the results showed the EU Referendum outcome may not have had as big an impact as first predicted.

“Our Report on Jobs data also shows employers are getting on with business as usual, with permanent placements in growth now for three consecutive months after dipping into decline in June and July,” he explained.

“Our jobs data shows 23 per cent of businesses plan to take on more permanent staff in the next three months.”

Skills shortage looming

Nevertheless, the REC urged for caution among organisations, given that candidate availability is on the decline. Permanent jobseeker numbers fell at a steeper rate in October than the preceding month, and Mr Hadley warned of a skills shortage in the UK.

Kevin Green, REC chief executive, said the availability of talented candidates has been dropping for three and half years, and there are notable shortages in sectors such as healthcare, engineering and construction.

At Barclay Simpson, our research shows there are skills gaps across roles in many corporate governance departments. Nearly 70 per cent of employers are finding it difficult to recruit suitable risk managers, while 71 and 79 per cent of respondents said the same about internal audit and compliance professionals, respectively, earlier this year.

Furthermore, experience remains a key factor for many hiring managers recruiting across corporate governance functions. For example, just six per cent of businesses were seeking internal auditors who had less than two years’ experience.

Clearly, organisations may need to strengthen their recruitment activities over the coming months if they want to attract the best candidates in what could be rapidly becoming a jobseekers’ market.

Our Market Reports combine our review of the prevailing conditions in the corporate governance recruitment market together with the results of our latest employer survey.