News Article

BUSINESS NEWS UK-Hiring confidence rebounds, demand for temp staff rises over the year: REC

Posted 3rd March 2020 • Written by •

Employers’ confidence in making hiring and investment decisions increased in the period from November 2019 to January 2020, returning to positive territory, according to the latest JobsOutlook survey from the Recruitment and Employment Confederation.

The survey showed that employer confidence in making hiring and investment decisions improved by ten percentage points this quarter, returning to positive territory at net: +7.

However, when asked if they think economic conditions in the country as a whole are getting better or worse, 46% of employers said worse while 19% said better. Despite confidence being in the negative territory, it was still an improvement over the previous rolling quarter.

Meanwhile, demand for permanent staff remains high, both in the short and medium term, at net: +21 and net: +26, respectively. Businesses are looking to expand their workforce after months of uncertainty and delay.

Demand for temporary agency workers fell back into negative territory this quarter when compared to the previous rolling quarter. However, short-term and medium-term levels were higher than in the same period a year earlier.

“Large employers especially have become more negative about hiring temps, perhaps due to the administrative burden of the upcoming IR35 changes,” the REC stated.

The REC also found that more employers highlighted the importance of agency workers for responding to growth (up from 57% to 69%) and for managing organisational change (up from 54% to 68%) compared to a year earlier.

Seven in ten (71%) employers who hire agency workers said that it is important that their recruitment agency partners provide information on how to manage your temporary workforce as a service.

REC’s survey also showed that approximately half, or 49%, of employers of permanent staff are already worried about finding enough candidates to fill their permanent vacancies.

“These worries are especially pronounced in sectors like health and social care and construction, industries where the government’s new immigration policy will have serious negative consequences for allowing labour into those sectors,” the report stated.

Tom Hadley, Director of Policy and Campaigns at the REC, said, “Businesses across the country have grown more confident since the election. With more certainty about what lies ahead in the short term, many have taken the opportunity to start hiring again. Now that demand for staff is on the rise and the majority of employers have little or no spare capacity in their workforce, staff availability is the major challenge.”

“As a result, last week’s immigration policy announcement has worried many employers. Sectors like healthcare, construction and logistics currently rely on workers from overseas, and are already facing labour shortages. Although the government might refer to these roles as ‘low-skilled’, they are highly important – not just for employers but also for patients, consumers and existing staff who are already overworked. We need a temporary work visa that allows businesses to hire the people they need at all skill levels and pay grades.”

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