Blog

31 January 2019
Take no deal off the table to restore business confidence

Latest news from REC

New data shows that employers’ confidence in the prospects for the UK economy remained negative for the sixth successive month, falling by two percentage points to net:-14 from the previous month, the joint-lowest since June 2016, according to the Recruitment and Employment Confederation’s latest JobsOutlook report.

The further drop in confidence in economic prospects coincides with employers’ confidence in making hiring and investment decisions declining by a notable five percentage points to net: +8, the lowest recorded since February 2018 and joint-lowest since June 2016.
Despite a fall in confidence in making hiring decisions, forecast demand for permanent employees in the short-term increased by 7 percentage points and in the medium term by 14 percentage points compared to the same time last year.
More than half (53 per cent) of UK employers who hire permanent staff expressed their concern this quarter over the sufficient availability of candidates for permanent jobs, up from 44 per cent a year earlier, with anticipated shortages of health and social care workers causing most anxiety for employers. Hospitality and engineering & technical workers were the other two professions where employers expect severest skills shortages. These three professions have been causing most concerns for employers over the last four months.
In the short-term, the balance of employer sentiment to hire on a temporary basis fell 10 percentage points from the previous month to +3, down 4 percentage points from the same time last year. In the medium-term, the balance of employer sentiment towards agency worker hiring tipped into negative territory this month, falling 11 percentage points to net: -1 from the previous month. This is six percentage points lower than in the same period last year.
Despite this quarter’s decline in anticipated demand for temporary agency workers, 47 per cent of employers intending to hire temporary workers expressed concerns over the sufficient number of agency workers with the necessary skills they require, up from 36 per cent last year. Employers are expecting the most severe skills shortages among drivers for the third successive month, followed by industrial and education sectors.
Neil Carberry, Recruitment & Employment Confederation chief executive says:
“The business community is united in wanting a no deal Brexit off the table. This avoids significant damage to our economy and helps to restore business confidence.
“The UK jobs market has been incredibly resilient but it cannot defy the effects of deep uncertainty indefinitely. Today’s data shows businesses’ confidence in investing has fallen dramatically – a clear sign of the dampener that no deal would put on business growth.
“We’ve been clear. The UK needs a clear transition period and a sensible approach to EU immigration to be written into the deal. That would go a long way to allaying economic fears.”
Recruitment & Industry News