Pay, the number of positions, and demand for professionals has risen across the board, according to data from The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs. Recruitment consultancies are driving the growth in the British economy as appointments reach levels not seen in years. Yet there is a concern for the engineering sector.
For July 2013, the latest data available, both permanent and temporary placements were registered at high levels by recruitment consultancies, who fed back their findings to KPMG and REC.
Job vacancies were at their highest since 2007 overall, while there were three- and two-year highs for successful permanent placements and temporary positions respectively.
“A combination of confidence returning to the UK economy and higher employer demand has contributed to this impressive set of figures,” said REC chief executive Kevin Green on the release of the report.
Demand for private sector workers has increased across the UK to levels not seen since records began in December 2011, with permanent engineering workers most in demand of the nine sectors surveyed. The north of England saw the greatest demand for permanent workers.
The public sector has seen less demand month-on-month for permanent staff, though demand for temporary workers in the public sector recorded its strongest rise this year.
What’s more, growth is expected to continue apace as economic confidence across the country increases. With increased confidence in the nation’s monetary stability, more employers are being forced to pick from a reduced talent pool to populate vacancies.
This is particularly acute in the engineering sector, where sustained underinvestment means that fewer than the 160,000 professionals needed to enter the industry every year are actually entering the workplace. Estimates by the Royal Academy of Engineering find there is a shortfall of up to 40,000 graduates per year for the engineering sector.
What few workers there are have already been placed with businesses, causing a marked reduction in the number of candidates available to fill permanent positions. Temporary workers are also fewer in number, as they find themselves already contracted in a hiring market.
That is having a knock-on effect on salaries paid to workers placed in employment by recruitment consultancies. Starting salaries are at their highest for 26 months, reflecting the skill shortages forecast for the near future, and the willingness to pay a premium for talent.
Bernard Brown, Partner and Head of Business Services at KPMG, explains that following the surge in employment, “a gap now exists between the demand for staff and the quality of candidates available so the onus is on candidates to improve their skills and prove their capability.”
There will be difficulties for employers, too, says Brown. Buoyancy in the employment market can cause workers to take more risks. “For some time staff have sat tight refusing to move when job security was low,” he says.
“Now the best staff will be looking for better offers so employers will need to strike a balance between recruiting new blood and retaining their best employees.”