Professional recruitment firms reported that vacancy numbers remained stable in August with vacancies up by 0.3% year-on-year according to new survey data from the Association of Professional Staffing Companies (APSCo). This is in line with the latest data from the Office for National Statistics (ONS), which reported in September that the overall employment rate was 74.5% in the three months to July 2016 – the joint highest since comparable records began in 1971.
The latest data from APSCo reveals notable variations between the trade association’s core sector groups in terms of hiring activity. While permanent vacancies across both financial services and marketing, for example, have increased (5% and 16% respectively), IT and engineering have both recorded dips (7% and 8% respectively).
Opportunities within financial services remain strong
Following a steady increase in demand pre-Brexit, temporary and contract vacancies dipped across the professional staffing market in August as they did in July, with opportunities softening by 2% year-on-year. The clear exception is the finance and accounting sector where vacancies increased by 16% in August. While this is most likely due to a reluctance to bring on board talent on a permanent basis until there is greater clarity around where Europe’s financial hub will sit post Article 50, APSCo data also shows that permanent vacancies within financial services increased by 5% year-on-year which indicates long-term market confidence. This is in line with the latest report from specialist recruiter Morgan McKinley, which found the number of available jobs in London expanded 4% month-on-month in August.
Engineering vacancies dip
Permanent vacancies within the engineering sector dipped by 8% year-on-year in August. This is despite the fact that The Markit/Cips UK Manufacturing PMI rose to 53.3 in August from 48.3 in July – the joint greatest month-to-month jump in the survey’s 25-year history.
This hesitancy to bring on board talent is likely to be attributed to sector-wide concern over the impact that leaving the single market will have on not only UK exports, but also the availability of talent.
According to a recent report on skills and demand from the Institution of Engineering and Technology (IET), 35% of employers believe that recruitment will be negatively impacted over the next four to five years due to Brexit as the pool of skilled workers in Europe would not be available to them.
A separate report, from the industry body for engineering and manufacturing employers, EEF, and global law firm, Squire Patton Boggs, warns that manufacturing companies must have ongoing access to the single market in goods and services and be able to employ and deploy staff from and across the European Union following Brexit.
Average salaries up
APSCo’s figures also reveal that median salaries across all professional sectors increased by 1% year-on-year. This figure is characterised by notable fluctuations in terms of sector, with HR for example, recording an uplift of 3.6% while in banking average salaries were down 4% year on year. Average salaries within the professional sectors fall short of the national increase in pay as reported by the ONS which found that earnings grew at an annual rate of 2.1% in the three months to July 2016.
Ann Swain, Chief Executive of APSCo comments, “While market sentiment remains volatile, an increasing number of economic indicators suggest that the UK economy is largely unfazed by Brexit. Unemployment is low, the housing market holding steady and the OECD has revised its forecast for UK growth up to 1.8%. Furthermore, surveys of the UK’s services, construction and manufacturing sectors suggested all three enjoyed a rebound in August after post-referendum slides in output. Growth in the professionals job market may not be strong, but the fact that vacancy numbers have stabilised year-on-year speaks volumes for the resilience of not only the recruitment sector but also the wider economy.”
Adam Pode, Director of Research for Staffing Industry Analysts, which compiles the report for APSCo, added, “Employers are taking a pause for breath. Their immediate concerns about Brexit have not materialised but many employers especially those headquartered outside the UK are starting to consider their options. Concerns are also being raised in some quarters about HMRC’s legislation due to come into force in April 2017 regulating freelancers. In general we are also seeing a trend to look at other forms of employment including self-employment and statements of work. What impact this will have on the marketplace is not clear yet.”