Employers continue to recruit but candidate availability remains low, reports find

Experts say firms need to invest in training as well as retention as skills shortage continues

Two in five employers expect the numbers of staff at their organisation to increase over the next year, new data shows.

A poll published today (10 March), commissioned by Acas, asked businesses whether they expected staff numbers to increase, decrease or stay the same over the next 12 months compared to the previous 12 months, and found that 41 per cent were expecting an increase. 

Nearly half (47 per cent) said they expected staff numbers to remain the same, 7 per cent expected a decrease, and 4 per cent didn’t know.

“As we come out of the pandemic restrictions, it is very encouraging to see a turnaround, with two in five employers expecting an increase in staff in the year ahead and nearly a half expecting no change,” said Susan Clews, chief executive of Acas. 

She added that many businesses experienced a challenging time following the pandemic and the employees at those organisations may have felt that they faced an uncertain future.

Separately, data also published today by KPMG and the Recruitment and Employment Confederation (REC) as part of its latest Report on Jobs survey also found that vacancies were up.

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The latest vacancy index – based on the survey of recruiters and where a score higher than 50 indicates an expansion and a score below 50 indicates a contraction – rose in February to 70.1. This compared to 69.3 in January. 

Permanent role vacancies also rose to 70.1 in February (up from 69.3 in January) and available temporary jobs increased from 65.1 in January to 71.1 last month.

Yet the survey saw the quickest drop in overall candidate availability for three months with the total staff availability index falling from 35.1 in January to 32.0 in February.

Among permanent roles, the index saw a fall from January to February of 34.9 to 31.8, while temporary staff availability experienced a decrease in the last month of 37.1 to 35.8.

Pay pressures are also on the rise, according to the survey, with a steep increase in the temporary role salary index from 64.8 to 66.4 between January and February. The permanent job index also rose from 76.5 to 77.6 over the same period. 

Commenting on the latest survey results, Jon Boys, labour market economist at the CIPD, said “candidates are becoming even harder to lure into roles with a corresponding rise in starting salaries”.

However, he warned that while the survey focused on the recruitment part of the workforce equation, “employers are increasingly focusing on retention and looking after their current workforce”. 

Boys advised that focusing on job quality including all forms of flexibility would “boost the value proposition of an organisation’s employment offer”.

Neil Carberry, chief executive of the REC, also observed that candidate availability has now been dropping for a year, “which shows the scale of the labour shortage the UK faces” as recruiters fill record numbers of posts, but that demand was still rising. 

“At a time when firms and workers are hard-pressed by inflation, making sure businesses can invest in wages and training matters,” he explained. 

Carberry called for the government to help businesses support people in the labour market and address the skills gap.