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Rising demand for labour fuels migration debate

A Cranfield University product story
Edited by the Engineeringtalk editorial team May 3, 2004

The latest research from the Recruitment Confidence Index has found that UK recruitment activity is set to rise for the fourth quarter in a row.

The latest research from the Recruitment Confidence Index has found that recruitment activity is set to rise for the fourth quarter in a row and more than half of employers - 52% - expect the size of their workforce to increase.

In addition, 23% of employers say the number of unfilled vacancies will go up over the next six months.

However, employers appear to be worryingly relaxed about how they will fill these vacancies.

They are not planning an increase in recruitment spend, nor are they predicting a severe skills shortage.

Although 38% are planning to increase their spending on commercial recruitment web sites and 31% say they will increase their spending on employment agencies, recruitment spend is largely set to remain the same.

Commenting on the results, Prof Shaun Tyson from Cranfield School of Management said: "All the indicators this quarter point to increasing demand for labour".

"The question is will the supply of labour be readily available, especially in the 'hot spots' of the South East of England?".

"The imminent expansion of the European Union does have the potential to fill some of these jobs, but it is unlikely to have a dramatic impact immediately".

"Rising labour costs could see jobs going the other way and moving out of the UK to elsewhere in Europe".

Stephanie Richards, Recruitment Research Manager at The Daily Telegraph said: "The challenge facing employers is whether they are prepared for the pending hike in vacancies".

"If they intend to rely on the existing supply of labour, as seems to be the case, they will need to think seriously about how they use reward packages to attract, retain and motivate staff".

The buoyancy of the recruitment market appears to have had little impact on business confidence.

Prior to the outbreak of the War in Iraq 65% of respondents reported optimism regarding business confidence.

That figure plummeted during the crisis and remains at only 19% this quarter.

Richards said: "Business appears to be in a perpetual state of uncertainty.

The threat of terrorism still looms along with the possibility of a rise in interest rates and a drop in house prices".

"It will be some time before we see more positive confidence ratings among employers".

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