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Professionals working across the recruitment sector will be acutely aware that the chronic skills shortage the UK has faced of late is far from over. Figures from the Office for National Statistics (ONS) show that the number of open job vacancies reached 1.29 million in the UK for the first time on record in January 2022. Openings within the hospitality sector alone have risen by an eye-watering 700% in a year.

Honing in on the white-collar jobs market, the latest Recruitment Trends Snapshot report from the Association of Professional Staffing Companies reveals that permanent job vacancies in the UK increased by 22% for the period between February 2021 and February 2022. Contract vacancies were also up 26% during this timeframe.

However, the data, provided by the global leader in software for the staffing industry, Bullhorn, does indicate a slight month-on-month dip in the number of new vacancies for both permanent and contract roles, which were down 11% and 12% respectively in February.

Demand for candidates still solid

As Joe McGuire, sales and strategy director, analytics, at Bullhorn, explains: “Placements continue to track well, and with job rates at such high levels already, it is not unexpected to see slight dips every so often. Demand for candidates remains extremely high, so when looking for meaningful changes in the direction of demand, this should be done over longer periods of time.”

While we may now be beginning to see the inevitable slowdown of the intense activity of the last few months, we are still in a situation where demand for skills is far exceeding supply across the professional sectors. This is particularly apparent when we look at our placement data.

Placements up

According to APSCo’s statistics, permanent placements rose 13% last month following January’s 104% spike in vacancies, which is indicative of the continued pressure on the staffing sector. Year-on-year comparisons also continue to show significant growth with permanent placements up 62% between February 2021 and February 2022, while contract placements also rose year on year, up by 15%.

The reasons behind a continuing strong demand for talent are varied and complex. Ultimately, though, vacancy numbers have boomed since the economy expanded post-pandemic, while the working population has failed to grow at the same pace. A significant number of workers simply left the UK following Brexit, net inward migration is down due to Covid-related travel restriction and many professionals who are nearing retirement age simply extracted themselves from the workforce as part of the “Great Resignation.”

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In addition, recent reports from the Chartered Institute of Personnel and Development (CIPD) suggest that long-term sickness absence rates may also be exacerbating labor shortages. In a survey of business leaders, the organization found that a quarter of UK employers say Covid is now one of the main causes of long-term sickness absence among their staff. Elsewhere, official data shows the number of people who are not working or looking for a job due to long-term ill health has increased by 230,000 from pre-pandemic levels.

Support from government needed

Despite the slight slowdown in vacancy numbers in February, the fact remains that the UK’s current skills landscape is not fit for purpose in the modern world, with ongoing skills shortages putting Britain’s future economic growth at risk.

In APSCo’s Access to Skills and Talent Public Policy Plan, we called on the government to rethink training initiatives and visa routes for highly skilled international talent to support a dynamic, global and flexible labor market. What’s more, we continue to meet with government to demonstrate the value of a globally focused recruitment sector, an internationally mobile talent pool of independent contractors and the benefits of introducing a work visa for self-employed highly skilled contractors.

The value of the staffing sector

At a time when the market is so tight, it seems that businesses are really seeing the value that external recruiters can provide. High levels of hiring have translated into increases in annual sales revenue for our members, with figures up 49% year on year for permanent placements and 80% for contract. However, while the professional recruitment sector has a vital part to play in unearthing the hard-to-find talent needed by organizations across the UK, we cannot do it without legislative support from the government.

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