Employers’ confidence in the UK economy has dropped to the lowest level since mid-2016, according to new data from the Recruitment & Employment Confederation (REC). In the run-up to the general election, confidence levels have fallen to a net figure of -34 in the REC’s latest report.
The findings underline the need for this. Employers are ready to invest, and significantly more businesses are looking to increase their permanent staffing than decrease it, both in the short term (net: +23) and the medium term (net: +26). However, these ambitions are being held back by political and economic uncertainty, and hiring confidence has dropped back into negative territory (net: -4).
Neil Carberry, Chief Executive of the REC, said:
“This month’s figures show that there is a great deal of potential in Britain’s businesses, just waiting to be unleashed. With so many firms at or close to full capacity, it’s no surprise that employers want to invest in their workforces. And it’s not just permanent staff – hiring intentions for temporary workers are positive too. Recruiters are using all their expertise to help find the right people to fill these vacancies, and three in four employers are happy with the work they’re doing.
“But it is uncertainty that is holding firms back. An incoming government should prioritise work by ensuring the two-way flexibility of the labour market is protected, allowing employers to recruit the staff they need while also protecting workers. This is the last set of JobsOutlook data before the general election, and we are urging all parties to think hard about how their policies will impact companies and their workers.
“Concrete measures like delaying changes to IR35, introducing an affordable two-year temporary work visa, or creating a Good Recruitment Taskforce will support employers and workers to make great work happen. By putting people at the heart of its industrial strategy, a new government can help employers to boost productivity and provide good jobs for people across the country.
Other key points from the latest include:
- Three in four (75%) employers indicated they had little or no surplus capacity in their workforce. This increased to 84% in the UK’s largest organisations (250+ employees).
- Half (50%) of employers of permanent staff reported that they were concerned about shortages of candidates for hire.
- Seven in ten (70%) employers increased pay/earnings in the year to August-October 2019. This was up from 57% a year earlier.
- Nine in ten (90%) employers who use recruitment agencies highlighted an agency’s regional and/or sectoral expertise as an important factor when choosing their recruitment partners.