Recruiters struggle to fill vacancies despite income boost

Recruiters struggle to fill vacancies despite income boost

Recruiters are finding that the dearth of skilled workers is pushing up salaries, according to the latest IHS Markit and the Recruitment and Employment Confederation (REC) survey.

For example, the report, which examined figures on weekly earnings from the Office for National Statistics (ONS) found in the construction sector, a skills shortage drove 5% wage growth in the three months to April despite the sector struggling financially.

Across industries more generally, pay increased by 2.5% in the three months to April in comparison to the same period last year, the ONS figures showed.

However, despite the optimism around this news, the rate is just above inflation, which currently stands at 2.4%.

The REC’s June data found that this rate of inflation regarding pay for new hires was close to a three-year high, with sharp increases in starting salaries witnessed across England.

Whilst this is a positive for jobseekers, with wages beginning to outstrip inflation, 42% of recruiters think trying to recruit permanent staff was worse than a month ago.

Neil Carberry, Chief Executive of REC, comments: “Recruiters report that some of this high vacancy rate may be driven by good demand from companies not being matched by candidate willingness to move in the face of the current economic uncertainty.”

Furthermore, the statistics come at a time where the UK is experiencing an employment boom. ONS statistics show that UK unemployment is currently at its lowest in 43 years. This equates to 32.4 million in work – 440,000 more than a year earlier.

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Sophie Wingfield, Head of Policy at the Recruitment & Employment Confederation, notes that this could also contribute to the problems recruiters are experiencing looking for new staff.

She said: “Whilst it is encouraging to see a rise in employment figures, a lack of candidates remains a major challenge for recruiters - particularly in areas like nursing, engineering, manufacturing and IT."

"Staff shortages are becoming business critical in many of these key sectors”.

In the REC’s most recent data, permanent roles continued to rise sharply in July, with low candidate availability and leading to a steep increase in salaries awarded to permanent starters. Temporary staff also experienced a boom with pay rates also rising.

The July data uncovered that the private sector had a greater demand for staff, with the strongest permanent increase in vacancies seen in the IT & computing industry.

Rises in temporary vacancies were most sharp in blue collar and nursing/medical/care sectors. The slowest rise in demand was reported for retail workers.

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