2024 UK Labour Market Analysis | Navigating Dynamic Employment Trends

Navigating Dynamic Employment Trends

Amidst a backdrop of economic uncertainty and global conflicts, the employment landscape of the UK is undergoing significant shifts. While the highly competitive hiring environment presents challenges – particularly for high-demand job titles and AI-related skills – opportunities abound for organizations to leverage data-driven hiring strategies and rethink their value proposition to better source and retain top talent.

Our comprehensive "Spring/Summer 2024 Europe Labour Market Report” explores the intricate dynamics shaping these markets. Here’s a look at the landscape in the UK, as well as notable trends in Ireland:

Macro Environment

The employment markets in both the UK and Ireland have faced significant volatility due to a turbulent economic landscape. Ongoing global conflicts, persistent economic uncertainty, heightened energy costs, and fluctuations in inflation and interest rates have collectively fueled rising costs and contributed to a decline in hiring activity.

The UK job market has become more competitive, with a rise in available workers coupled with a decline in job vacancies. Meanwhile, the Irish job market has experienced a deceleration from the hiring boom of 2021-22, particularly in the technology sector, a key industry alongside pharmaceuticals.

Current interest rates have emerged as a factor affecting both regions, slowing investments, impacting liquidity and minimising growth opportunities across sectors.

According to data from KPMG and the Recruitment & Employment Confederation, hiring activity for both permanent and temporary roles continues to fall. In Q4 2023 the UK experienced a 5% decline in the estimated number of vacancies, marking the 18th consecutive period of decline, and that trend continued into January 2024.

Skills in Demand

In the UK, a surge in AI technology adoption has increased demand for professionals proficient in AI and machine learning (ML). This aligns with the government's initiative to position the UK as a global leader in unlocking AI’s potential to enhance quality of life. Sought-after skills in global software sales, cloud services, and managed security expertise reflect the strategic priorities of companies navigating a technology-centric marketplace.

In Ireland, a housing crisis has propelled a surge in demand for construction-skilled workers. Looking aat other sectors, key trends include: Other notable developments include:

  • Technology: High demand for engineers, especially those specialised in validation and automation engineering

  • Pharmaceutical: An emphasis on skills such as microbiology and chemistry method testing, particularly within biopharmaceutical operations

  • Overall: Increased need for professionals with expertise in data analytics, data science, and project management using agile methodologies

Remuneration & Benefits

The UK experienced year-over-year wage growth of 6.4% in January 2024, rebounding from a Q3 decline of 3.6%. Conversely, Ireland saw moderate wage growth, reaching 3.7% by the close of 2023, below the Eurozone average.

Candidates’ decision-making processes extend beyond salary considerations to factors like remote work policies, holiday entitlements, pension contributions, and avenues for career progression. Maintaining a healthy work/life balance is a persistent priority, with flexibility playing a critical role.

Sixty-six percent of organisations in the region recognise the need to offer flexible working options when advertising jobs, underlining its growing importance in attracting and retaining talent.

Get the Full Report

Our new “Spring/Summer 2024 Europe Labour Market Report” also includes bill rates for key job titles in the UK and Ireland, as well as exploration of high-level trends across Europe. Beyond this broader analysis, we also dig deeper into the economic landscape in Germany, Sweden, the Netherlands, and Switzerland. For much more, download the report now.

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