Northern employers are pulling out all the stops to attract, and crucially, retain staff. However, with high inflation eroding pay packets and a recession forecast for the end of 2022, the region's labour market could soon reach its peak, according to the CIPD's latest Labour Market Outlook report.

The quarterly survey of senior HR decision makers indicated that hiring intentions remained strong, with 74% of employers in Yorkshire and Humber expecting to recruit in the next three months.

However, close to half (48%) of employers in the North have hard-to-fill vacancies. In order to tackle such recruitment and retention challenges, the top response from employers has been to upskill more existing staff (40%) followed by advertising more jobs as flexible (31%) and by raising wages (28%).

The CIPD's Labour Market Outlook report also found that ay award expectations have hit a record high in the private sector, rising to a median of 4%, the highest of any sector in the Labour Market Outlook's current time series, which began in 2012. The median expected basic pay increase across all sectors continues at 3%.

However, the CIPD - the professional body for HR and people development - is warning that pay increases cannot be sustained over the long-term so employers should look at other ways of supporting financial wellbeing in the cost-of-living crisis, such as enhancing their overall benefits package.

Jonathan Boys, labour market economist for the CIPD said:

"We're seeing some of the highest pay awards in recent history as employers strive to attract and retain staff. However, strong pay growth can't last forever. To deal with the cost-of-living crisis, employers will have to look at other ways they can support their people. Employer benefits that help reduce the cost of housing, travel and childcare will be of particular value to those on the lowest incomes.

"Employers are taking numerous measures to keep their existing people by upskilling staff, increasing wages and improving job quality. This makes it a good time for the Government to capitalise on employer appetite for upskilling.

"It's vital employers have the right support mechanisms in place to access the training they need. Reform of the apprenticeship levy could help by enabling organisations to spend the levy on training that best suits their business's needs at this crucial time."

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