Yet another surge in UK job vacancies

Further evidence of the continuing skills shortage confronting virtually every sector of the British economy has been provided by the latest official figures and by two surveys from leading trade bodies.

female Asian CEO and her team analyzing data in business reports during the meeting in the office.

David Sapsted

15 February 2022

Data from the Office for National Statistics (ONS) on Tuesday showed that the UK's unemployment rate fell to 4.1% - virtually what it was before the pandemic struck - while job vacancies hit a new record high of 1.3 million between November and January.

Job vacancies: good and bad news

Matthew Percival, director for people and skills at the Confederation of British Industry (CBI), commented, "The good news is that the UK economy is continuing to create jobs. The bad news is that businesses are struggling to hire. Bold action is needed to go for growth, with steps to address skills and labour shortages."

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Surveys from APSCo, KPMG and REC

Meanwhile, the latest 'Recruitment Trends Snapshot' from the Association of Professional Staffing Companies (APSCo) shows that permanent white-collar vacancies rose once more last month - up 28% compared to January last year.Publication of the report came after another survey by KPMG and Recruitment and Employment Confederation (REC) found a further, steep increase in recruitment activity across the UK.The APSCo report, based on data from staffing industry software provider Bullhorn, also revealed a year-on-year rise of 38% for contractors and showed that demand for both permanent and contract staff soared between December and January as pandemic restrictions eased."This continued pressure on the recruitment market comes at a time when skills shortages are plaguing the UK, with the ONS revealing at the end of last year that over half of businesses reported they are unable to meet demand due to worker shortages," said APSCo.

The UK needs "flexible and pragmatic training initiatives"

The association is calling on the government to devise "flexible and pragmatic training initiatives" to maximise access to the skills that employers need.
APSCo’s report also recorded a year-on-year increase of 84% increase in the number of candidates accepting new permanent roles last month.Ann Swain, CEO of APSCo said, “The hiring market in the UK is showing no signs of slowing. While this is promising for staffing firms, skills shortages remain rife across the country which will only be exacerbated if vacancy numbers continue on the same growth trajectory without a sustainable solution to the dearth of talent."

The KPMG/REC survey found the steepest increase in permanent staff appointments was in the South of England, while the fastest rate of growth for temporary positions was in the North.Despite the continued growth in hiring, the rate of decline in overall candidate availability quickened for the first time in five months during January, with shortages among permanent job-seekers greater than the reduction of temp candidates.

Starting pay rising

The report also said the "robust demand" for staff combined with candidate scarcity was driving up rates of starting pay, particularly for permanent staff. The largest increase in demand for staff last month was seen in IT and computing, followed by the medical and care sector.Neil Carberry, chief executive of the REC, said, "The jobs market is still growing strongly at the start of 2022. Recruiters are working hard to place people into work as demand from employers continues to rise."With competition for staff still hot, companies are having to raise pay rates for new starters to attract the best people. And the cost of living crisis means there is also more pressure from jobseekers who want a pay rise."But pay is not the only important factor - companies must think about all aspects of their offer to candidates to ensure they get the staff they need. This will be important as firms’ spending is under pressure from inflation as well.”