Brexit Creates Staff Shortages for Employers
According to a report published today by the Recruitment and Employment Confederation (REC), British employers are struggling to hire staff due to Brexit and the departure of European Union workers.
London was particularly hurt since permanent job growth weakened to an eight-month low. With Brexit uncertainty, London’s financial services are more hesitant in hiring new staff and this is already having an effect on London’s labour market.
REC, a group that represents recruitment agencies, released the Markit/REC report on Jobs today, providing a detailed view of the UK labour market based on recruitment consultancies’ data.
The report found that there was a sharp growth in staff appointments, while growth in temp billings increased at the fastest rate for almost two and a half years. Recruitment agencies reported a robust increase in demand for employees, but the availability of both permanent and temporary staff continued to fall during the month of July. In particular, the availability of temporary workers has declined sharply for over a year and a half. Salaries for permanent positions rose in July with the rate inflation reaching a 20-month record, while hourly pay rates for short-term staff continued to increase.
The Midlands and the North of England saw the strongest increase in permanent jobs, while London saw the weakest.
In terms of the private and public sectors, the demand for staff was stronger in the private sector with the number of vacancies increasing. However, in the public sector, demand for both temporary and permanent workers weakened.
There was a noticeable increase for permanent workers especially those in Engineering, Accounting/Financial and IT & Computing.
REC Chief Executive Kevin Green highlighted that the jobs market was doing well, with both permanent and temporary jobs growing, and starting salaries rising.
However, he said that now employers had to “work even harder to fill jobs as vacancies rise and candidate availability shrinks.” Green added: "The parts of the economy most reliant on European workers are under even more pressure as many European Union workers return home. Employers are not just struggling to hire the brightest and best, but also people to fill roles such as chefs, drivers and warehouse workers.”
As he warned, it is impossible to ignore the UK’s labour market’s close associations with the EU. Green said, “If we want to keep our jobs market successful and vibrant, we must make it easier, not harder, for employers to access the people they need.”