Employers need to increase workforce to meet demand

Business confidence has been shaken since the EU referendum; however, employers say they need to hire more staff to meet demand.

That’s according to the latest JobsOutlook survey by the Recruitment & Employment Confederation (REC).

A third (34%) of employers surveyed in the three months to August say they have no capacity to take on more work without hiring more staff, while 43% say they have only ‘a little’ spare capacity and would need to grow their workforce in order to meet an increase in demand.

More than a fifth (22%) of businesses plan to take on more permanent staff in the next three months. Only 4% expect to decrease their permanent workforce in the same period.

The survey also reveals that business confidence has weakened month on month since the EU referendum. In August, 34% of respondents said that economic conditions are ‘getting worse’, compared to 22% in July and 13% in June. More than a quarter (27%) of public sector employers have made redundancies in the last year, compared to 16% of private sector employers.

REC Chief Executive Kevin Green said: “With record-high employment in the UK, the fundamentals of the jobs market are strong. Thanks to a resilient business-as-usual attitude from consumers since the referendum, demand on businesses has remained buoyant and this is reflected in employers saying they will actively expand their workforces in the coming months.

“This is good news, but there are question marks around the sustainability of positive trends we have seen since the referendum. Skills shortages are a major problem in many sectors, one that will only get worse if the supply of skilled EU workers is in any way curtailed. Employer confidence has fallen significantly, suggesting that while businesses continue to perform well, there is much anxiety about what the future holds.

“The government can help to allay these concerns. We hope that fiscal stimulus will be top of the agenda in the Chancellor’s Autumn Statement. That, coupled with an immigration policy designed to help businesses thrive, will improve confidence and bolster the success we have seen so far.”