2023 is forecast to be an excellent year for both candidates and employers with shifts towards a ‘normalised’ recruitment market. We are still in a tight market with candidate numbers low and vacancy numbers high. It’s been a great time for candidates to find jobs and employers have been able to navigate the easing tight market towards the end of 2022 by seeking help from recruitment agencies to assist in retaining the best candidates. This month, we assess the latest data for 2023 to reveal the jobs outlook for a steady and bright year ahead.
Permanent jobs growth is slowing
The latest REC Jobs Outlook Report reveals that we have experienced a reduction in permanent placement growth. However, this needs to be taken into context and seen as the positive news it is. The post-pandemic rate of growth in permanent jobs was always going to be unsustainable – we already had 21 months of increasing growth. We are still experiencing growth, but it’s easing now to a more manageable pace. The slowdown has been particularly notable in London, but this means a closer match between candidates and employers. Temporary job billings in London have “expanded modestly” again after stagnating slightly.
Demand for staff is strong but more manageable
Recruiters have found it hard to meet employers’ demand for staff because candidate numbers have been relatively low. However, with demand easing slightly and unemployment remaining very low, it makes it increasingly possible to meet employer demand. We are seeing greater demand for temporary workers and 2023 is likely to be a very positive year for those looking to extend their careers through temping.
Starting salaries continue to increase, just not as fast
We’ve witnessed huge salary inflation for new starters in the last 18 months. The latest data reveals starting salary and temporary wage growth is still increasing, but it’s the softest increase we’ve seen in 19 months, and higher rates of pay will help with the cost of living concerns.
Candidate supply is difficult but easing
For employers, it’s good news and there is notable evidence that candidate supply concerns are easing slightly. As the 2023 economic climate develops, employers remain confident in their hiring plans and we recommend that employers work with dedicated recruitment agencies that are able to source excellent candidates, despite supply issues.
We have found the job roles most notably in short supply include credit control, payroll, HR, secretaries, admin and office staff. We’d like to reassure employers that we have strong numbers of relevant candidates and if you are finding it difficult to locate staff, please contact us.
Neil Carberry, Chief Executive of the REC, said:
“A flatter period in the labour market is inevitable in this current economic climate, but demand is being supported by some major underlying factors, including labour shortages and technological change. The main way to boost performance is to unlock growth by businesses putting their people planning first as a strategic way to enhance productivity.”
We have highly professional temporary and permanent candidates in our network who are ready to start with you now. If you need recruitment support now or you need to plan for 2023, please send us an enquiry at the red button below, or call us on 020 7870 7177.