The Latest Jobs Outlook from the REC/IHS Markit

Latest figures show that employers are looking to hire, as forecast demand for permanent staff is increasing however, these hiring plans are being hampered by uncertainty and employers' confidence in the economy has fallen again, according to latest CIPS/IHS Markit survey. Please click here  to see extract or if you would like further information.

The REC/IHS Markit survey says:-

"Falling Business Confidence frustrates Employers Hiring plans..."

This quarter, 30% more employers felt that economic conditions were worsening rather than improving, a fall of 4 percentage points on the previous rolling quarter. In contrast, the balance of confidence in making hiring/investment decisions improved by 1 percentage point, edging it back into positive territory.


****   SHORT-TERM OUTLOOK   ****

When asked the following questions "In the next 3 months, do you think the number of permanent workers in your organisation will increase or decrease?"

One quarter (24%) of employers of permanent staff stated that they would be increasing their permanent headcount over the next quarter, when surveyed in June–August, down from 30% last year. This included 31% of employers in London and 29% in the Midlands, but significantly fewer (18%) in the South (excluding London). Just 3% of employers suggested that they would be releasing workers back into the availability pool, compared with 2% in the same period last year.

 

****   MEDIUM-TERM OUTLOOK   ****

Question: "In the next 4 –12 months, do you think the number of permanent workers in your organisation will increase or decrease?"

More than a quarter (27%, down from 35% last year) of employers said they would be adding to their headcount in the medium term whilst just 2% (down from 4% last year) planned to reduce numbers. Regionally, 35% of employers in the Midlands planned increases and just 1% planned to reduce headcount. Significantly smaller/micro (0–49 employee) enterprises (30%) planned to boost headcount than large (250+ employee) organisations (19%).


****   OUTLOOK BY EMPLOYER SIZE   ****

Net balance of short-term expectations by employer size (permanent staff)

In the short term, the balance of sentiment towards increasing permanent headcount was strongest amongst the UK’s mid-sized (50–249 employee) enterprises, when surveyed in June–August. At net: +25%, this was notably lower than the sentiment recorded a year earlier (+39%). In contrast, the balance amongst small/micro (0–49 employee) and large (250+ employee) organisations fell, year-on-year, from net +24% to net +19% and from net +26% to net 19%, respectively.

 

****   WORKFORCE PLANNING   ****

What changes have you made to your workforce in the past year?

The extent to which employers had made redundancies and/or reduced hours over the last year varied significantly by region. The proportion that had made redundancies ranged from just 6% of employers in the Midlands to 24% in London. Similarly, the percentage of employers that had reduced hours ranged from 6% in the South (excluding London) to 20% in the North.

 

****   WORKFORCE PLANNING BY SECTOR   ****

From a reward perspective, the proportion of public sector employers that had increased pay/salaries over the last year rose from 54% in June–August 2018 to 71% this year. In contrast, the proportional increase was smaller in the private sector (rising from 51% to 61%). The proportion of public sector employers that had made redundancies over the last year fell from 16% to 9%. The decline was much smaller in the private sector, however, falling from 15% to 13%. Instances of the use of headcount freezes also notably fell in the private sector (from 21% to 14%), whilst the level remained static in the public sector at 13%.

 

Notable above-average levels of forecast short-term demand continued amongst employers seeking to hire permanent workers in Health & Social Care – up 5 percentage points compared to the last quarter. There were also sharp rises in forecast demand for Technology (up 7 points to net +29) and Marketing, Media & Creative Professionals (up 7 points to net +25).

Positive outliers in relation to temporary hiring included demand for Engineering & Technical professionals (up 44 points to net +39). In contrast, forecast demand for Health & Social Care workers continued to sit firmly in negative territory at net -29.

The above is extracted from REC / IHS Markit Jobs Outlook for September 2019.  Beaumont Select are members of the Recrutment & Employment Confederation (REC)