Challenges of recruitment
7 September 2022
While the Bank of England has forecast that the UK will fall into recession at the end of the year, some analysts believe that its impact will be mild compared with the downturn triggered by the 2008 credit crisis.
Some say that if there is a recession, it will be unlike most others because employment levels and vacancies remain high. Indeed, businesses are finding it difficult to recruit good people, as reported previously on the blog.
Despite the turbulence, the labour market has remained in robust shape, achieving near-record unemployment levels. Higher interest rates, as we have seen recently, usually raises joblessness in the economy by forcing up borrowing costs for businesses and making it difficult to employ new workers, but that doesn't seem to be happening at the moment.
Neil Holloway, managing director of the Wilson Brook executive search and recruitment consultancy, says that the situation is unprecedented.
“The impact of Covid-19, overseas workers returning post-Brexit, people wanting to do something different after the lockdowns or seeking a better work-life balance have all made recruitment more difficult for employers,” he tells me, with the result that employers are having to be creative and more flexible in their offerings.
“We are hearing of instances where probationary periods are being waived for potential new recruits. Some candidates are nervous about the future and are anxious about the perceived risk of having less job protection than at the previous company where they worked for many years.
“Clearly the salary package is another consideration and we are also hearing of companies making one-off payments or bonuses to help with the rising cost of living and to retain their employees.
“Some candidates may also expect a more tax-efficient electric company car to be provided, rather than a petrol or diesel one.”
Certainly, some hirers and suppliers are telling me that they are resorting to putting up signs outside their premises or on their stands at exhibitions and events as a way of advertising for new staff, and Neil agrees that firms are using a host of promotional methods, “anything and everything just to get people through the door.
“Some companies are using employee referral schemes, whereby existing staff receive a bonus if they introduce a friend or family member who subsequently takes up a position. Joining bonuses are also being offered to stimulate interest.
“And if one company in a certain sector introduces an incentive like that, others may do likewise so they don’t fall behind in the pecking order.”
Neil says that employers now have to be flexible in terms of working from home and other considerations.
“And I can’t see the situation changing any time soon. Yes, there are considerations about the economy and the state of the market, but beyond that the underlying fundamentals are still the same. Construction companies and hire firms need to attract new people into the workforce and there are no quick fixes.”