Uncertainty continues to weigh on making decisions

Uncertain outlook continues to dampen recruitment activity

• Latest data signalled that permanent staff hiring declined again in April, though the rate of reduction softened from March’s 32-month record and was only slight. Recruitment consultants widely commented that Brexit-related uncertainty had impacted on hiring decisions. At the same time, billings from the recruitment of temp workers rose at a quicker pace amid reports of firm demand for short-term staff.

• The index measuring overall vacancies edged down further in April, to signal the weakest increase in demand for staff since August 2012. The softer expansion in total vacancies was predominantly driven by a slower rise in permanent staff demand. 

Availability of candidates declines again in April

• A reluctance among workers to seek new roles due to uncertainty related to Brexit, as well as a generally low unemployment rate, led to a further decline in staff availability. That said, both permanent and temporary worker supply deteriorated at softer rates than in March.

• Greater competition for scarce candidates contributed to steep increases in pay for both permanent and temporary workers. That said, the rate of starting salary inflation was the softest seen for two years. In contrast, temp wages rose at the strongest rate since January. 

Regional and Sector Variations

London recorded the quickest drop in permanent staff appointments of all four English regions. In fact, the North of England was the only area to see an increase in permanent placements during April. On a regional basis, the North of England noted the quickest expansion in temp billings, closely followed by the South. The Midlands meanwhile noted the first reduction for just over seven years.

April data continued to point to subdued public sector staff demand compared to the private sector. In the public sector, permanent vacancies fell slightly, but rose marginally for temp workers. Demand for permanent staff in the private sector meanwhile rose at a softer, but still strong, rate and strengthened for temp workers.

IT & Computing topped the rankings for permanent staff demand, closely followed by Nursing/Medical/Care and Engineering. However, the majority of monitored sectors noted softer increases in vacancies. Retail noted a sharper decline. 

The quickest increase in temporary staff vacancies was again seen in Nursing/Medical/Care in April. Blue Collar and Hotel & Catering completed the top three in the rankings. In contrast, short-term vacancies fell in Executive/Professional and Retail.

My view and observations

It seems that the even though there is still a demand for permanent staff, the market appears to be slowing down and there is a developing Mexican stand-off between candidates and companies looking towards Brexit to know what their next move is.

Companies are still looking towards an Agile and flexible workforce and the UK economy is still strong and performing well. Companies are continuing to use interim resource to assist in the spikes in demand whilst there’s still a period on uncertainty and they look for solutions to deal with the eb and flow of these ever evolving times.

In short, whatever the outcome, we need to sort out Brexit in order to stabilise both company owners and employees. The inability to see and plan from one half year to the next or even the next quarter in some circumstances is beginning to hold people back.