Recruitment Activity Continues to Rebound in April 2021

April's UK Employment Report sees recruitment activity repounding  as easing of lockdown boosts market confidence

Key points from the survey:

  • Permanent placement growth hits highest since October 1997
  • Demand for staff improves to greatest extent in 23 years
  • Marked drop in candidate availability places upward pressure on pay

The main findings for April are:

Rapid increase in recruitment as coronavirus restrictions begin to ease

The easing of national lockdown measures and brighter outlook for the economy led to a further marked increase in recruitment activity at the start of the second quarter. Permanent placements expanded at the sharpest rate since October 1997, when the survey first began, while temp billings growth remained historically strong.

Steepest rise in vacancies for 23 years...

The upturn in demand for staff gathered pace in April, with overall vacancies increasing at the quickest rate for 23 years. Permanent vacancy growth outpaced that seen for temporary roles, with the former rising at the quickest rate since March 1998 and the latter to the greatest extent since October 2014.

...but supply of candidates falls markedly...

After broadly stabilising in March, the availability of candidates fell in April, and at the sharpest rate since January 2020. Reduced candidate supply was often linked to ongoing pandemic-related uncertainty preventing people from seeking new roles. There were also mentions that Brexit, IR35 legislation and furlough had reduced the pool of available candidates.

...leading to further increases in both starting salaries and temp pay

Skill shortages and improved demand for staff led to further increases in starting pay for both permanent and temporary staff. Starting salary inflation hit a 14-month high, while temp pay growth improved to its best for a year-and-a-half.

Neil Carberry, Chief Executive of the Recruitment & Employment Confederation, said:

“The jobs market is improving at one of the fastest rates we have ever seen, and that’s great news. We are bouncing back from a record low – and many people are still struggling – but the data shows that job creation is firing up again. This month’s numbers for permanent hiring are the best we’ve seen since the survey started in 1997. Temporary hiring has chalked up its ninth straight month of growth, demonstrating again how important temporary agency work is to getting families and businesses back on their feet. “The message for government and employers alike is that the long-term challenge is less likely to be high unemployment than attracting and training enough staff to keep our economy firing. Companies need to be thinking about their workforce planning and employee offer, which professional recruitment firms are best placed to support them with. Government needs to urgently tackle shortfalls in the skills system, and make sure the new immigration system is more responsive to our economic needs.”

Commenting on the latest survey results, Claire Warnes, Partner and Head of Education Skills and Productivity at KPMG UK , said:

“There’s a lot to feel positive about this month, with the easing of lockdown improving business confidence in the economy and in turn driving a sharp rise in recruitment. “However, it’s concerning that we’re seeing a drop in candidate supply due in part to applicants needing support to adapt their skills to move from displaced sectors to those where there is more demand, such as health and care, and because the furlough scheme has reduced the pool of workers. “Companies will not be able to fill their vacancies unless they commit to reskilling and upskilling their current and prospective employees. This includes providing furloughed staff with training and working with recruiters to make sure as wide a range of candidates are considered for jobs. Businesses have a fundamental role to play in bridging the increased skills gap that’s emerged from the pandemic.”

The Report on Jobs is unique in providing the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies and employers to provide the first indication each month of labour market trends.

Mosaic Search and Selection Ltd contribute market data to this Report on Jobs which is a monthly publication produced by Markit and sponsored by the Recruitment and Employment Confederation and KPMG LLP.  The full copy of this report is available from Markit.

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