Permanent job vacancies rise at record pace in may

In line with the easing of COVID-19 restrictions and the re-opening of certain sectors, the rate of hiring has increased over the last month. 

According to the latest KPMG and REC UK Report on Jobs survey, permanent vacancies rose at a record pace – at the fastest rate for over 23 years – while vacancies for temporary workers also grew substantially.

At the same time, there was a clear deterioration in staff supply with overall candidate availability declining at the quickest rate since May 2017. Lower staff supply and rising vacancies led to further increases in starting pay, with both starting salaries and temp pay expanding at sharper rates than in April. This was largely attributed to lingering pandemic uncertainty and a subsequent reluctance to seek out new roles, fewer EU candidates and furloughed staff.

In light of the increased demand and low supply, the rates of starting pay were pushed up again in May. Starting salaries for permanent staff rose to the greatest extent since September 2018, while temp wage inflation hit a near two-year high.

Regionally, it was the North of England that saw the steepest increase in permanent staff appointments of all four monitored English regions. However, the South of England also saw a substantial recovery whilst the rise in vacancies in the Midlands and London stayed largely stagnant.

Vacancies continued to rise more sharply in the private than the public sector, with the quickest increase in demand seen for permanent staff in the private sector.

IT & Computing and Hotel and Catering saw the steepest increase in vacancies although demand for permanent workers rose across all ten monitored job categories during May.

Claire Warnes, Partner and Head of Education, Skills and Productivity at KPMG UK, said:

With demand for workers in May increasing at the fastest rate in 23 years, the jobs market seems to be firing on all cylinders, and we need this momentum to continue for our economy and businesses to fully bounce back.

But the deterioration in staff supply intensified this month, with overall candidate availability declining at the quickest rate since May 2017. This is a worrying trend and the message is clear: we need businesses and recruiters working alongside Government to urgently address the skills gap by supporting candidates and employees to upskill and reskill to move into new roles. This will be crucial to our recovery from the pandemic and the levelling up of opportunities across the UK.

Kate Shoesmith, Deputy CEO of the REC, said:

Now is the time for action. With demand spiking, the skills and labour shortages that already existed in the UK have come into sharper focus – and COVID has only made them worse. This is the most pressing issue in the jobs market right now, and has the potential to slow down the recovery.

Employers must think about how they can attract the staff they need, for example by looking at the wage and benefits package on offer – there is particular demand for more flexible and hybrid work. But government also needs to urgently look at improving access to work and opportunities for everyone to participate in training that will lead to a job. This should start with careers information that signals where job openings are being created and funding for the relevant work-related training.

Employers prioritise leadership & digital skills for 2021

Leadership skills including Coaching, Onboarding and Decision Making top the list of most sought-after skills employers are looking for in new recruits, according to job search engine Adzuna.

The study analysed over 600,000 UK job ads advertised in 2020 and just under 150,000 jobseeker CVs to compare the skills sought after by employers with the skills shown by jobseekers, revealing the skills growing in demand and current skills gaps.

With many industries still working remotely, employers are placing greater emphasis on Coaching, Onboarding and Decision Making skills compared to a year ago, as hiring and leading teams through the pandemic is a particular focus. Coaching skills were referenced in 3.7% of job ads in 2020, up from 3.3% in 2019. Onboarding is second, referenced in 0.7% of job ads in 2020, up from 0.4%, as the rise in remote working has driven a need for more onboarding specialists. Decision Making is fourth, cited in 1.5% of job ads, up from 1.3%.

Commenting on the research, Andrew Hunter, co-founder of Adzuna, said: “Leadership skills such as onboarding and decision-making have grown in demand as employers seek experienced staff to help them navigate through the Covid-19 crisis. That’s also borne out in job vacancies, where openings for more experienced staff have recovered more quickly than those for entry level positions.

This sharpened focus on skilled staff is also seen in job vacancy numbers. Overall, advertised UK vacancies are down 35.8% compared to a year ago, but entry-level graduate vacancies are down 61.0% year-on-year. There are just over 8,000 advertised graduate vacancies currently available, compared to over 22,000 of the highest-paid roles with advertised salaries over £70,000, typically suitable for more experienced jobseekers.

Data demand

Jobseekers with Digital Marketing skills and GDPR knowledge are also in growing demand as employers focus on harnessing the power of the internet, rather than bricks and mortar stores and offices, to reach their customers. Digital Marketing was cited on 1.0% of all job ads in 2020, up from 0.9% in 2019, yet just 5% of jobseekers mention the skill on their CV. Similarly, GDPR featured in 1.1% of job ads in 2020, up from 1.0% in 2019, with 4.3% of jobseekers citing the skill on their CV.

There is a significant skills gap within the Tech industry across the UK. There are over 81,700 IT jobs currently on offer in the UK, accounting for 8.3% of total hiring. However, IT skills are only mentioned in 6.8% of UK CVs. This has increased slightly from 6.10% in 2019, but it still highlights a notable gap in an industry that boasts an average salary of £53,518 (45.0% above the national average of £36,903).

Many specific tech skills are also growing in demand among employers. Programming language Python was cited in 1.6% of job ads in 2020, up from 1.5% in 2019. This is also the most common coding language referenced on jobseekers CVs, found in 6.9%, compared to the 5.6% of jobseekers referencing Java, and just 0.5% mentioning Perl. 4,479 job ads overall require Coding skills.

Cyber Security, AI and Machine Learning are three more skills growing in demand. Cyber Security was cited in 0.6% of job ads in 2020, up from 0.5% in 2019, with 1.7% of jobseekers currently referencing this skill on their CV. Meanwhile, AI and Machine Learning are cited by 0.5% and 0.6% of job ads respectively.

By contrast, the skills gap within Digital has decreased year-on-year. There are 45,800 Digital jobs across the UK, equal to 14.8% of all vacancies. However, the number of jobseekers showcasing digital skills on their CV has increased year-on-year from 16.7% to 19.3%, closing the skills gap in this sector.

Lingual boost

French is the most sought after language in the UK job market, with 2,908 active vacancies looking for French speakers in the UK. German is the 2nd most in-demand language with 2,457 active job vacancies, while Spanish rounds out the top 3 with 1,704 open job vacancies. French is the most common second language with 12.1% of CV’s referencing French as a skill or qualification. In comparison 9.6% of CVs reference Spanish, 6.0% cite German and 5.6% reference Italian. There is a notable opportunity for Mandarin speakers with only 1% referencing the language and 893 open opportunities for Mandarin speakers.

Cited by just 3.2% of jobseekers on their CV, Arabic is becoming more sought-after by employers, with 0.13% of job ads referencing the language in 2020, up from 0.10% in 2019. Similarly, Sign Language was referenced in 0.08% of job ads in 2020, up from 0.06% in 2019, with 984 jobseekers citing BSL on their CV in 2020 and 300 citing ASL.

What are young people looking for in a graduate job?

Research shows the wide-scale level of disruption COVID has caused for young people with over half of the students saying that their ideas about their future career had changed since the start of the pandemic.  

A report by the Institute of Student Employers (ISE) and Debut, a graduate recruitment app, reveals the effects of COVID-19 on students’ thoughts towards graduate jobs and their careers.

In light of the pandemic, students also revealed what they were looking for when it comes to a future job.

The most important priority, which an overwhelming 98 per cent of students agreed with, was the organisation treating them fairly. The opinions towards this differed by demographics. The demographics most likely to believe that employers will treat them fairly in the recruitment process were White respondents and those who attended the non-Russell group. Conversely, Black and Black-British young people (65 per cent), as well as other non-white ethnicities (52 per cent), were less likely to believe that the recruitment process would be fair.

The second highest priority was the job involving interesting work whilst the organisation providing access to training and development ranked third.

Interestingly, an above-average salary ranked sixth most important in a list of nine priorities, indicating that it is not necessarily the most important motivating factor. However, even the least motivating factor which was that the student would be working with people like them received a 73 per cent agreement rate, with almost three-quarters of graduates choosing this as a priority.

Additionally, over half of the students surveyed (57 per cent) stated that their ideas about their future career had changed since the start of the pandemic. Less than half (42 per cent) expressed feeling confident about finding the job that they wanted quickly after leaving education.

Specifically, more women reported changing their minds towards their career in light of the pandemic than men with 61 per cent of women considering this in comparison to only 52 per cent of men. Additionally, men felt more confident than women in finding a job than women (with 48 per cent of men believing this versus only 38 per cent of women).

The report makes several recommendations to employers in order to attract the best talent:

  • Making it explicit that the job is a pathway to a fulfilling career
  • Discussing the wider opportunities that the company will provide
  • Reaching a diverse pool of candidates through various channels
  • Making meaningful connections with candidates
  • Shifting to online recruitment processes if necessary

Additionally, to ensure diversity is made a priority, the report recommends the following:

  • Giving candidates the opportunity to see how they will fit in with the company
  • Being mindful of how you will communicate with different candidates – they all respond well to different approaches
  • Recognising what the students have achieved in their education

    *This data was taken from ISE and Debut’s report ‘What do students really want?: Listening to the voices of young jobseekers’. This survey questioned over 2000 students and job seekers in the UK in June-July 2020.