Home Business News UK job market to reach long-term recovery with vacancies and salaries hitting highest levels in 2023

UK job market to reach long-term recovery with vacancies and salaries hitting highest levels in 2023

by LLB Reporter
24th Jul 23 12:06 pm

Vacancies and salaries for UK jobs have increased for the fifth month in a row, underlining the long-term recovery of the jobs market but there is still a long way to go to get inflation fully under control, according to the UK Job Market Report by smarter job search engine Adzuna.

The total UK vacancies in June increased to 1,059,153, up +0.78%. Despite wider economic concerns, inflation, and layoffs in some sectors like IT over the past two years, the UK jobs market has now seen more than 1 million open vacancies every month since June 2021, with skilled labour shortages continuing to prop up vacancy levels.

The sustained growth in job openings since February demonstrates that the UK is on the path to long-term recovery. Though June’s vacancies were down nearly -12% compared to last June, the year-on-year gap has lessened from -16.8% in May and -19.45% in April. If this trend continues, hiring should be back at 2022’s record levels by the end of the year. Time to fill roles is also the lowest it’s been since Adzuna’s records began, at 34.6 days on average, down from 34.9 a month ago.

As well, average advertised salaries increased to £37,803, up +0.15% since May and up +3.6% since last June, with skills shortages and the cost of living crisis meaning employees are continuing to put pressure on companies to give pay rises. Whilst UK inflation has started to fall, there are concerns that high wages will mean that there will be no immediate relief from high interest rates in the next few months.

The majority of sectors tracked by Adzuna have seen small positive increases in monthly vacancy numbers including Creative and Design (+2.32%), Hospitality and Catering (+2.34%) Legal (3%) and Manufacturing (+3.52%). IT experienced its first monthly increase in available job roles this year, up +0.11%, pointing to the slow recovery of the tech and IT industry.Yet Consultancy (-2%), Graduate Jobs (-2.02%) and Logistics and Warehouse jobs (-2.66%) continue to fall monthly.

Nearly 80% of sectors are still experiencing annual falls in vacancies compared to this time last year, including HR & Recruitment (-48.07%), PR, Advertising and Marketing (-28.55%) and Sales (-21.22%). However, sectors including Engineering (+4%) and Energy, Oil and Gas (+11.93%) are experiencing growth in hiring, year on year.

With the academic year coming to an end, the biggest annual increase in vacancies was in Teaching, up +34.1% compared to last year’s figures, and up nearly +37% compared to January. There are over 120,000 teaching jobs available, making it the largest sector recruiting on Adzuna. Teaching is also the industry which is quickest to fill roles – average postings are just for 30.7 days, adding to the pressure heads are dealing with widespread teacher strikes and high competition to fill roles ahead of the new academic year in September.

Salaries increasing sector-wide

Annual average advertised salaries continued to increase in June, to £37,807, the highest salaries have been since April 2021 (£37,898).

The biggest annual increase in salaries sector-wise was for Property roles, +14.43% compared to June 2022, despite vacancies being down by -22.3% year-on-year. Sectors including Travel (+11.63%), Domestic Help and Cleaning (+11.56%) and Maintenance (+9.27%) also experienced salary increases compared to last year.

In fact, few sectors saw salaries decline year-on-year, apart from HR and Recruitment (-3.77%), IT (-3.22%), and Scientific and QA (-4.53%). The recent public sector pay deal of 5-7% struck in July will influence the overall salary picture in the next coming months.

Northern Ireland continues to see the highest annual growth in salaries, up +10.16% since last June, the sixth consecutive monthly rise for the region. Yorkshire and The Humber reclaimed second place with salaries increasing +7.43%, ahead of East Midlands (+7.23%) and Wales (+7.07%). London continues to be the only region not experiencing an increase in salaries, however, the gap has fallen from being down -2.11% in May to only -1.3% in June.

Looking at city-wide salary data, Leeds has continued to see the biggest annual change in average advertised salaries, up +12.8% compared to last year. Across the board, cities are experiencing positive salary growth including Bedford (+9.23%), Manchester (+6.98%), and Exeter (+3.06%). The only cities still experiencing salaries falling are London (-1.3%) and Cambridge (-5.5%).

Cambridge, Guildford and Chelmsford top places to look for work

Cambridge remains one of the best places to look for work with only 0.25 jobseekers per role, with job vacancies increasing +10.25% since last year and one of the highest average advertised salaries behind London, Reading, Oxford and Leeds. Guildford (0.34) and Oxford (0.55) and Reading (0.58) are also places with low competition for jobs.

Across the UK however, competition for jobs is slightly increasing, from the lows of 1.45 in May to 1.47 in June. This is still some of the lowest levels recorded in 2023, but demonstrates a slight increase in the number of people starting to look for work.

Warehouse work is trending

Warehouse work has overtaken Social Care as the trending job on Adzuna’s Intelligence Portal. This metric tracks demand for a wide range of occupations and designates an Interest Quotient for each role. The higher the quotient, the more in demand those roles are among Adzuna jobseekers.

There has also been an increase in jobseekers looking for lorry driving roles and cleaning jobs.

Andrew Hunter, co-founder at Adzuna, said: “A first glimpse of June’s data shows that vacancies and average advertised salaries continued to increase, as they have done since the start of the year. Albeit, inflation has fallen faster than initially expected there is still reason to be worried that high wages will entrench ‘sticky’ inflation.

“We fully expect official figures later this month will confirm what Adzuna’s monthly Job Market Report is showing.

“If hiring trends continue to improve, we could be back at the record hiring levels we saw in 2022 by the end of the year whilst the time to fill roles is now the lowest we’ve seen since we began analysing the UK jobs market in 2016, demonstrating that competition is high amongst employers looking to snap up the best candidates.”

Tony Wilson, Director at Institute for Employment Studies, said, “These figures show that despite the recent small rises in unemployment, the labour market is still incredibly tight.

“Vacancies remain high and jobs are being filled very quickly, and salaries are still rising month on month. While this poses risks for future inflation, it’s also a reminder that the economy is still creating a lot of opportunities and many of them well paid.

“So we need to be doing more to help those out of work to get back in, but also to help employers to fill their jobs – in particular by making jobs more inclusive, flexible and secure.”

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