12 Aug 2019

Labour Market Outlook surveys

An increase in non-EU workers helps ease recruitment difficulties for medium and high skilled jobs

Adecco Group UK and Ireland logo

The quarterly Labour Market Outlook, produced in partnership with the The Adecco Group UK & Ireland is one of the most authoritative employment indicators in the UK and provides forward-looking labour market data and analysis on employers’ recruitment, redundancy and pay intentions.

The Adecco Group UK&I and its brands are part of the Adecco Group, the world’s leading HR solutions partner. As a Group, we provide more than 700,000 people with permanent and flexible employment every day. With more than 34,000 employees in 60 countries – 3,100 in the UK&I – we transform the world of work one job at a time. Our colleagues serve more than 100,000 organisations with the talent, HR services and cutting-edge technology they need to succeed in an ever-changing global economy. As a Fortune Global 500 company, we lead by example, creating shared value that meets social needs while driving business innovation. Our culture of inclusivity, fairness and teamwork empowers individuals and organisations, fuels economies, and builds better societies. These values resonate with our employees, who voted us number 5 on the Great Place to Work® - World’s Best Workplaces 2018 list. We make the future work for everyone. 

The Adecco Group is based in Zurich, Switzerland. Adecco Group AG is registered in Switzerland (ISIN: CH0012138605) and listed on the SIX Swiss Exchange (ADEN). The Group is powered by nine lead brands: Adecco, Modis, Badenoch & Clark, Spring Professional, Lee Hecht Harrison, Pontoon, Adia, General Assembly and YOSS.  

The Adecco Group UK&I’s head office is located in London, UK. We have 11 brands, including the Adecco Group UK&I, Adecco, Adia, Ajilon, Badenoch & Clark, Modis, Office Angels, Penna, Pontoon, Roevin and Spring.

Labour Market Outlook: Summer 2019

Amid continued political uncertainty, broadly employment growth this Summer remains strong. The majority of LMO employers still intend to increase staff levels, and pay expectations for the coming year increased marginally within the private and public sectors.  

However, a slight decline in employment confidence this quarter highlights that key recruitment and retention challenges remain for many employers. For example, this quarter saw a worrying decline in the number of applicants for low-skilled jobs, which is due at least partially to the fall in migration from the EU. 

In comparison, the supply of candidates for medium and high-skilled jobs has remained consistent. This is partly because of a relatively high number of non-EU migrants arriving in the UK during the last year to live and work. The removal of the migration cap for key professions, such as healthcare, has been key to reducing recruitment difficulties for employers.  

Download the full report below:

Summary

Labour Demand

While demand for labour remains relatively strong, it softened slightly during the last quarter. This quarter’s net employment balance, or the difference between the proportion of employers who expect to increase or decrease staff levels, decreased from +22 to +18 in the last three months. 

The strength in labour demand was highest within healthcare (+38) and business services (+34). 

Labour supply 

This quarter’s data suggests that employment growth over the past year has resulted in fewer applicants for low-skilled roles. On average, employers received 16 applicants for the last low-skilled position they recruited for, compared with 20 in Summer 2018. 

The average number of applications received by employers for the last medium or high-skilled role they advertised remain relatively unchanged. For high-skilled roles, employers received 5 applicants this quarter compared to 6 in Summer 2018. For medium-skilled roles, the figure remained unchanged at 10.  

Given the strong levels of labour demand, it is no surprise that most of the organisations currently hiring also record a high proportion of hard-to-fill vacancies. Of organisations currently hiring, 67% report that at least some of these vacancies are proving difficult to fill (compared with 66% in Summer 2018). 

Wages and Salaries

Pay expectations for the next 12 months grew slightly among both private and public sector employers. Expectations remain higher within the private sector, increasing from 2% three months ago to 2.5% this quarter. Public sector expectations rose from 1% to 1.5%. The overall basic pay expectations for all employers remains unchanged at 2%. 

However, the share of employers that expect basic pay to increase by 3% or more has increased compared with the same period last year. More than one in three (36%) employers expect their basic pay award to increase by at last 3% in the year ahead, which compares with 28% of employers in the same period last year.

Additionally, significant sectors of the labour market − such as construction, retail and hospitality − are signalling that continuing recruitment and retention pressures are putting upward pressure on salaries for the majority of staff. 

Labour Market Outlook archive

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