The latest (Q2 2019) Labour Market Outlook from the CIPD and the Adecco Group shows Britain’s jobs boom is set to continue in the next quarter as employers continue to shrug off the uncertainty around Brexit with new hires. However, despite the tightening labour market, this confidence has yet to translate into significant salary increases for all but new starters and those with key skills.
Pay outlook – pay growth largely limited to key staff and new starters
Despite rising recruitment and retention pressures, median basic pay expectations in the 12 months to March 2020 remain at 2%.
Inflation is continuing to put upward pressure on pay for some organisations. Recruitment and retention difficulties are also a key factor in driving pay decisions, affecting new starters and key staff in particular.
Here at Gradsouthwest, we are certainly seeing upward pressure on the starting salaries of STEM graduates in particular - a group that are both new starters and in shortage skills areas.
Recruitment outlook – jobs growth set to continue
Britain’s jobs boom is set to continue in the short term. However, buoyant demand for staff is creating recruitment challenges. Two in five (41%) employers say it has become more difficult to fill vacancies in the past year. Three in five (61%) employers said that at least some of their vacancies were proving hard to fill.
Skills shortages – employers are having to be more flexible to find candidates
Skills shortages are particularly being seen in professional occupations (e.g. scientists, engineers) where 50% of employers report that applicants don’t have the required level of skills needed.