While employers continue with the ongoing struggle of trying to find available candidates, salaries have increased as a result.

While employers continue with the ongoing struggle of trying to find available candidates, salaries have increased as a result. 

The latest IHS Markit and Recruitment and Employment Confederation (REC) Report on Jobs released some very encouraging news for candidates just last month. It has been found that average starting salaries for newly-placed permanent staff rose at the second sharpest rate for over three years in the UK in August. 

Unsurprisingly, it’s the lack of skilled workers that’s pushing up salaries. If you take the construction sector for example, a skills shortage drove 5% wage growthin the three months to April despite the sector struggling financially.

As well as dealing with increasing wage bills, another headache companies up and down the country face is the ongoing skills shortage. Despite the fact that there has been a sharp increase in the number of jobs being advertised across the UK, the availability of both permanent and temporary candidates continues to decline. 

Vacancies were found to have expanded at a pace that was only a fraction slower than July’s eight-month record but despite more jobs becoming available and salaries rising, employers simply can’t find the candidates to fill these roles. 

It’s thought that there are a number of factors contributing towards the lack of candidates in the UK at the moment. 

The first one is the ongoing economic uncertainty following Brexit. As the deadline for the UK to leave the EU looms, everyone -politicians included – still don’t know exactly what this means for the country and the long-term impact it’s going to have. Naturally, this is making candidates far too nervous to change jobs. 

Secondly, despite everything going on, the UK is actually experiencing an employment boom. Figures from the Office for National Statistics (ONS) show that unemployment is currently at its lowest in 43 years. While this is of course fantastic news, with fewer people in need of a job and those already in employment apprehensive about changing roles, it means there is very little candidate availability. 

A separate survey carried out by business organisation, The British Chambers of Commerce (BCC) and online recruitment job board, Indeed, has found that companies are even dishing out pay rises in order to retain staff for as long as possible.

It was found that 6% of companies surveyed are planning to increase pay by more than 5%, 32% will boost pay up to 5%, 12% will keep pay rises in-line with inflation and 18% will increase pay by 1-2%. Just 2% of firms say that they expect to decrease salaries. 

Speaking about the current situation, Jane Gratton, BCC Head of Business Environment and Skills Policy commented:

“Our survey has shown that growing and pervasive skills shortages are making it harder than ever for firms to fill job vacancies - so it is little surprise that they are pulling out all the stops to keep hold of the ones they have.”

If you’re struggling to find great candidates and would like help with your recruitment process, please don’t hesitate to get in touch with Alpha and our experienced consultants will be more than happy to help.