UK employment numbers not only provide clarity on the state of employment; they show us how well aligned with reality employers’ expectations about staffing difficulties are.
Many staffing decisions are based on such projections, so the relative accuracy of employers’ expectations can have a large impact on the wider economy. One only has to think of Tech’s pandemic hiring spree and subsequent layoffs to see how disastrous warped projections can be.
To this end, we should not only pay close attention to today’s numbers; we should compare them with data collected in May 2023 on the state of recruitment.
The industries most likely to report hard-to-fill vacancies were Education (60%), Healthcare (55%), Public administration (47%), Finance and Insurance (46%) and transport and storage (45%). However, the majority of industries expected to see these difficulties lessen somewhat over the next 6 months.
The industries most expecting significant problems with hard-to-fill vacancies between May-October 2023 were Healthcare (44%), Education (42%), Public administration (42%), Construction (30%) and Transport and Storage (27%). Nearly half of Financial companies expect their staffing troubles to wane, with just 25% expecting significant problems filling vacancies in the next 6 months.
Why do organisations expect vacancies to be easier to fill?
There are likely three reasons:
- Most organisations have already put in place measures to resolve staffing issues. Popular approaches include increased wages, upskilling initiatives and a greater reliance on part-time or contingent workers.
- The overall balance of employment is trending positive. In May 2023, The net employment balance remained stable at +27. This is a generally positive sign for the health of job markets.
- Popular narratives like ‘The Great Resignation’ have largely petered out. While staffing shortages remain and the ‘candidate-driven market’ is very much still in evidence, they are no longer tied to a larger cultural phenomenon – and therefore appear less significant.
Today’s numbers will ultimately help us determine the validity of these reasons – and hopefully ensure employers adjust their strategies to better align with reality.