A new survey from the jobs site Indeed has found that UK job vacancies have fallen by 12 per cent in 2016, amid rising business costs following the March Budget and continuing uncertainty about the outcome of the EU referendum on 23rd June.
Job vacancies across virtually all sectors dropped by nine per cent between March and April. The only exception was in the Hospitality sector, where job listings rose.
The study states that the introduction of the National Living Wage (NLW) last month and ongoing uncertainty over the EU referendum have contributed to growing reluctance amongst employers to recruit.
Indeed’s resident economist, Mariano Mamertino, said that the NLW had already proven divisive, and the debate would be fired further by the new findings in the current survey.
He conceded that thousands of the UK’s lowest-paid workers received a welcome boost to their pay packets last month, but noted that the benefits had largely been confined to regions such as Wales, Northern Ireland and the North East, which have higher numbers of poorly paid jobs.
He went on: “Yet even by marginally eroding employers’ appetite to hire more staff, the policy may have unwittingly made life somewhat harder for some jobseekers. Job vacancies in 12 of the 13 sectors tracked by Indeed fell in April, accelerating a trend that began in March following the announcement of the EU referendum.
“The combination of business uncertainty about the potential impact of a Brexit, the slowdown of the economy amid global economic headwinds and a sudden increase in the wage bill for many firms has triggered a sharp cooling in the jobs market.”
A slew of other surveys this month have indicated much the same: employers appear to be reluctant to expand their permanent workforces in the context of uncertainty over the outcome of the EU referendum and increasing businesses costs.
However, most of these studies yielded a somewhat more nuanced picture than the Indeed survey by revealing that, while permanent hiring does seem to be slowing, employers are turning to Umbrella Company Employees and other temporary/contracting workers to undertake business-critical projects.
One new study bucked the trend altogether, reporting big increases in pay and demand for both permanent and contract staff. Recruitment finance provider Sonovate found that demand and pay rates for permanent and contracting IT professionals was booming in the UK’s FinTech sector.
Meanwhile, the latest REC/Markit “Report on Jobs” found job vacancies for permanent staff slowed in April while those for contract and temp workers accelerated markedly.