Thank you to all who attended our recent webinar in partnership with APSCo. In case you missed it, check out both the key headlines and the webinar recording below. 

A massive thank you to Stuart Feest of APSCo for speaking at our webinar. The writeup below is taken from his contribution to the event.



What happened?

The country has never seen a candidate shortage like this. They’re certainly not a new thing (we’ve seen sizeable candidate shortages during the advent of the millennium and Dot Com Bubble), but what we’re witnessing now is much more extreme and much less predictable.  

Vacancies are rising rapidly in the wake of the pandemic, but applications per vacancy (APV), by contrast are tumbling at a colossal rate. Recent BroadBean insights have shown that this is happening across the manufacturing and production, logistics and supply chain, and retail sectors especially. 
 

Vacancies

APV

Manufacturing & Production

+32%

-46%

Logistics & Supply Chain

+85%

-60%

Retail

+101%

-55%

 

A staggering majority of recruitment businesses are reporting these figures. A recent report from REC and KPMG reported that even in the wake of an increase in permanent placements as more parts of UK economy reopen, overall candidate availability is declining at the quickest rate since May 2017. Job vacancies soar as the skills shortage bites, and it doesn’t seem to be ending any time soon 

Vacancy levels are the highest they’ve been since 1998, with candidate numbers falling at the second-fastest rate in the above survey’s history. This is a trend that is being seen across both blue and white collar industries, and the impact is being shown in resultant changes in salary – salaries for permanent staff have risen to the greatest extent since December 2018, and wages for contractors and blue-collar works are hitting a near two-time high. 


These impacts are being felt in every sector, and almost every industry is seeing the same V-shaped recovery, demonstrating excessive demand. In the financial services sector, we saw a 38% rise in vacancies between Q1 and Q2 this year, and hiring levels by the end of July are already 7% higher than the whole of last year’s total. Both JP Morgan and Citibank have reported sizeable impacts, with the former currently struggling to fill 2,246 jobs (an 18.3% increase of its 2020 total) and the latter 1,552 jobs, up 39.2% year-on-year. 

In addition to the Financial Services Sector, HR is also struggling, having overseen a 19% rise in vacancies Quarter on Quarter, along with total hiring levels for 2021 already surpassing 2020’s annual total by 23%, resulting in a large surge in demand for recruitment specialists. 

We’ve seen a huge fall in unemployment following the pandemic, and conversely some of the largest amounts of vacancies in history. So – what’s causing it?

A graph demonstrating the upswing in vacancies during 2021. 


Why is this happening?

Firstly, it’s important to point out that this was actually already happening before the pandemic – a pre-COVID skills shortage was already in effect following the wake of Brexit back in 2016. Following the implementation of the post-Brexit points-based immigration system, we’ve seen a lack of European workers – 1.3 million non-EU workers have left the UK since COVID. Couple this with concerns over job security, furloughs, and what’s been termed The Great Resignation, which oversaw people walking out of their jobs en masse during the pandemic, it’s easy to see how the perfect storm has been formed – and for those that did continue to work throughout the last few years, they are very much in the position to start setting some new rules. 

You’ll be well aware of hybrid working as a concept, but how it’s been adopted by businesses across the country has varied to different degrees. Most companies are aiming to get staff back into the office, though a few now view this as an outdated approach, instead offering fully flexible packages for their workers. Others have opted for hybrid approaches, including 3 days in, 2 days out or vice versa – and more and more businesses are catering to this whether they want to or not. 

There is now such a sizeable cohort of jobseekers and employees that the genie is very much out of the bottle. Professionals the world over have seen the benefits hybrid and remote working can offer. A staggering 85% of people want to adopt the approach in the future, and this is being mirrored clearly in the massive upswing in searches for job adverts that feature flexible working in their descriptions. These searches are now 3 times above the average in February 2020. 

However, whether or not businesses want to comply with these requests still remains to be seen. 75% of jobs still offer no options for flexible working, despite 90% of employees wanting it in some way. Businesses do seem to want to offer flexible working, but not all are equipped or otherwise able to provide it.

 

Where do we go from here?

The way forward for hiring businesses is clear – offer remote working and the salaries/wages that your people deserve. Businesses have to ensure that if it’s offered, it is showcased clearly in the adverts they’re putting out, with a focus on the candidate proposition. It makes sense to be on the front foot when it comes to policies and procedures, and ensuring the workforce is as happy as possible. 

Compromise on requirements where you can, put time and effort into the candidate experience, and forge meaningful relationships with your recruitment companies – because you’ll need them sooner or later!

 

Published in Blog

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