Employers urged to plan ahead as recruitment prospects rise

The nine enduring workplace tensions to keep an eye on in the year aheadFresh evidence that the recession is over as the CIPD reports employment intentions are at the highest level for six and half years. However, pay continues to perform well below pre-recession levels, and the HR body warns that with the economy picking up, now is the time for employers to consider both the levels of pay and employment conditions they have to offer; and the reputation and branding of their organisation. Although CIPD’s quarterly Labour Market Outlook finds little evidence that the buoyant jobs market is feeding through into recruitment difficulties for the majority of employers in the short term, in some areas; such as engineering and management/executive there is already a struggle to fill high-skilled vacancies. The CIPD is therefore urging employers in all sectors to start planning ahead to mitigate the risk of widespread skills shortages in the longer term.

The Spring 2014 Labour Market Outlook net employment balance* has increased to +26 from +16 since the Winter 2013/14 report. Although this is the highest score since autumn 2007, median pay expectations, excluding bonuses, are unchanged at 2 per cent.

Just two in five employers report that they currently have vacancies that are hard to fill, which is broadly consistent with previous Labour Market Outlook surveys. Recruitment difficulties are higher in the public sector than in the private sector and employers report that the majority of vacancies they find hard to fill are highly skilled or skilled (71%). Engineering roles are the hardest to fill, followed closely by management and executive roles, and the most common reason for difficulties filling vacancies is a lack of technical or job specific skills.

Encouragingly, more organisations plan to invest in their talent pipeline than in previous years, with around three in ten (31%) employers that currently have hard to fill vacancies intending to hire more UK graduates, around one in five (22%) planning to hire more apprentices and half (50%) of such employers planning to up-skill existing staff in the next two years.

“The UK jobs market looks set to continue its remarkable post-recession performance,” said Gerwyn Davies, labour market adviser at the CIPD. “However, while skills shortages are still relatively concentrated in particular sectors and occupations in the domestic labour market, and pay continues to perform well below pre-recession levels, there is a danger that this may change if the labour market continues to tighten.”

HE advises: “Against the backdrop of the prediction of strong employment growth, now is the time for employers to ensure that any future plans to increase business investment prioritises investment in training.

“This will not only help stave off the threat of recruitment difficulties increasing sharply in the future, but also help to boost productivity levels that we know are essential to the nation’s overall economic performance and therefore pay prospects.”