Skills shortage pushes up wages

Skills shortage pushes up wages

The average British worker has seen their salary increase by two per cent in the past year, according to the Office of National Statistics’ (ONS) new figures for the three months leading up to October.

Year-on-year, the number of people in employment has increased by 505,000. There are currently 22.88 million people working full-time in Britain, with 8.42 million people working part-time.

Ann Swain is the CEO at APSCo. She says: “It’s not surprising that average pay continues to rise, particularly within the professional sectors, as organisations compete to attract the top talent and fill shortages.

“According to the latest monthly APSCo Professional Recruitment Trends report, remuneration has seen notably increased in key economic sectors, where addressing skills shortages is crucial in facilitating continued growth, in particular the banking and financial services market, where uplifts of 18.5% and 10.8% respectively have been experienced.”

But Doug Monro, Co-Founder of Adzuna, says that while the falling unemployment figures and rising salaries are “encouraging news”, it “may only prove to be a short-term improvement.“

He explains: “More people are in full-time work in the run up to Christmas, as the festive period delivers a new round of jobs approaching the end of the year. Advertised customer service roles are on the rise, providing crucial work opportunities for many and courier vacancies are the most popular.”

He warns that the “jobs market may appear well on its way to reaching its former strength” but that the reality is not as good as people may think.

Monro continues: “Falling unemployment has failed to translate into a real improvement for job hunters.”

He quotes a recent report from Adzuna that revealed a current ratio of two vacancies for every jobseeker. "A chronic skills shortage is making it more difficult than ever to fill positions.

“This has resulted in an uneasy dependency on both internal and overseas migration in order to prop up the jobs market into the next year. The New Year will present a real challenge for both employers and jobseekers – as both struggle to find the right person, or the right job. For the jobs market to be firmly back on its feet, proactive ways to tackle the skills deficit need to be found.”

Salaries for people in work may have increased. However, advertised salaries are decreasing as more companies focus on retaining staff rather than on recruitment, according to Adzuna’s UK Job Market Report for August. You can find the story here.  

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