The last time I sat down to write a review post was at the start of the year, and in the intervening six months, several events have happened that will no doubt impact the overall job market throughout the rest of 2022.
In February, Russia invaded Ukraine, which has impacted the global economy and is pushing up inflation and the level of geopolitical risk, according to a recent review article on the federal reserve website.
While sizeable, these effects do not appear large enough to derail the global recovery from the pandemic, which is good news even though the news outlets continue to lead with the worst-case scenario.
The recession word is being used more frequently, and there is no doubt that certain parts of the globe will dip into recession, though for how long is hard to predict, especially in the U.K.
First, let’s cover a few important areas as we dive into how world events impact your hiring and potential career development, starting with the inflation increase we are all experiencing in our personal economy.
Inflation And Its Impact
Regarding inflation, prices have risen significantly in the past year due to increased spending on goods during the pandemic.
As economies worldwide, including in the U.K., opened up after Covid restrictions eased, some businesses struggled to meet this extra demand because of difficulties in getting the materials used in their production.
Energy bills are one of the biggest contributors to inflation, as oil and gas prices remain at elevated levels in part due to the Ukraine war.
After a rise in the U.K.’s energy price cap in April, average gas and electricity prices jumped by 53.5% and 95.5%, respectively, compared with a year ago.
Our weekly shopping bill has increased too. The rising cost of food and groceries means the average yearly shopping bill will increase by £380 in 2022 – more than another £100 since April alone.
Price pressure is also fuelled in the U.K. because of what is happening in the job market.
- There are more job vacancies than there are people applying.
- Employers are offering higher remuneration packages to attract candidates.
The Bank of England has stated that inflation is forecast to keep rising this year and is also expected to slow down in 2023 and be around the 2% mark in two years.
That’s both because the main causes of the current high rate of inflation are not likely to last, and interest rates have been raised several times over the past few months.
In 2020 there was a huge shift in remote working, which has seen the biggest impact on how we work in the last twenty years, which I want to explore now.
Hybrid Working and The Four Day Week
In a recent ONS research study, most employees who worked remotely during Covid plan to work from home and the office, i.e., ‘hybrid work’ in the future.
In spring 2022, when guidance to work from home because of the pandemic was no longer in place in Great Britain, 38% of working adults reported working from home at some point over the past seven days.
In 2022, the proportion of employees working at home and their usual place of work, ‘ hybrid working’, has been rising, while the proportion of those working from home exclusively has fallen.
The last few years have seen a real shift in hybrid work becoming ‘normal’, and here at Rebus Recruitment, candidates are looking for employers who offer flexible working as part of their criteria to consider a move to a new company.
In addition, we now have the four-day work week trial happening in the U.K. I covered this topic in detail here; why the four day work week could attract accountancy talent for those of you considering this as part of your offer.
And with the skill-short market not going away anytime soon, the four-day work week is more likely to make your company appealing to accountants who want to achieve a higher level of work/life balance as they move forward in their careers.
Considering what is happening, how is this impacting the recruiting market outlook? Next, I’ll share data from; the CIPD, ONS and the U.K. government website that sheds some light on the situation we are all experiencing.
Recruitment Market Outlook
Despite the events I have listed above, the quarterly labour market outlook from the CIPD in June this year continues to show an upward trend in the intention of companies to recruit.
Though this data is not finance specific, our sector continues to outperform others in the volume of companies recruiting and vacancies listed.
Almost three-quarters (74%) of employers say they are planning to hire new staff in the next three months, equating to high employment confidence.
The net employment balance – which measures the difference between employers expecting to increase staff levels and those expecting to decrease staff levels in the next three months – remained high at +36, after reaching +37 last quarter. This continues to exceed pre-pandemic levels, pointing to strong employment intentions.
But as expected, recruitment difficulties remain, with 45% saying they have hard-to-fill vacancies.
The worst areas are healthcare, education, and the voluntary sector.
As highlighted by the Bank of England, the most popular response to hiring difficulties has been to raise pay (44%); though general pay rises are higher than in the past at 3%, they aren’t expected to keep up with inflation
Employers may be reaching a limit on how much further they can go on improved remuneration packages: only 27% anticipate raising pay in future to address hard-to-fill vacancies.
Encouragingly, employers are also looking to other means to tackle staffing challenges: 39% have focused on upskilling more existing staff, and 38% have advertised more jobs as flexible.
These are vital factors in improving job quality and will be increasingly important for employers as they wrestle with recruitment and retention.
With the general market overview similar to earlier in the year, how can finance employers navigate the remainder of 2022 as they continue to grow?
Currently, we’re seeing a new focus on concepts previously disregarded in Employer Value Propositions. Today’s teams want more social responsibility, flexibility around working hours and where they work, and personal and career growth opportunities
To create a powerful EVP, finance companies need to redefine the priorities of their teams alongside their own.
Candidate care is becoming increasingly relevant to attracting and retaining staff, as I shared in a recent presentation and an article I wrote last month you can access here: candidate care.
Companies can’t afford to miss out on the best candidates in the “great resignation” age, where team turnover is greater than ever. The Society of Human Resource Management says most businesses will need to replace up to 20% of their workforce yearly, even without considering turnover trends. Your business will suffer if you miss out on good candidates or have a disengaged team.
This is why candidate care, a method of delivering exceptional support for candidates through every stage of the employment cycle, is crucial to any company’s future success.
With the right strategy, you improve your chances of finding the talent you need while convincing them to develop and build their career with you rather than someone else.
If you are looking for support to build your talent pipeline and would like advice on how to develop an attractive brand that attracts candidates that you look after, please get in touch.
At Rebus Financial Recruitment, we have years of experience helping business leaders to find the best finance professionals for their organisations.
Reach out to us today via email or on 01282 930 930 to get started.
About Rebus Financial Recruitment
Rebus Financial Recruitment provides a specialist and focused recruitment service to its customers, ranging from various organisations, including SMEs, to large PLCs.
We strive to offer both the client and candidate a seamless recruitment experience. Using our expertise, we get to the heart of employer and employee needs, and, in doing so, we match the two perfectly. Contact one of our team today to find out more, or you can call us on 01282 930930.