Most firms plan to increase permanent employee numbers

Two thirds of organisations intend to increase the number of permanent employees in 2022. This expansion comes despite fears of a forthcoming recession predicted by the British Chambers of Commerce, with inflation forecast to reach a peak of 14% later this year.

The latest recruitment trends survey from XpertHR has revealed that the “great resignation” isn’t the only driver of intensified recruitment efforts for the UK organisations sampled. Those roles left vacant by former incumbents account for only 55% of advertised positions, while newly created roles will account for an average of 35% of total vacancies.

XpertHR’s research found that just 10% of organisations planned to reduce the size of their workforce in 2022. This varied, on average, from 14% for organisations that employed between 1-249 employees, 5% for those employing between 250-999 employees, and just 3% for those employing over 1,000 employees.

Recruitment is set to remain fiercely competitive for the remainder of the year, XpertHR suggested, as the number of permanent employees that organisations predict they would need to recruit equated to 10% of the overall workforce. This comes as the number of applications companies receive per role has fallen since 2021, by 20% for directors and 60% for managers. For remaining employees, the decline is even more drastic, falling by 80% from 25 to 5%.

In response, businesses have had to enhance efforts to make roles more attractive for both incumbents and prospective employees. Nearly two thirds of organisations (62%) surveyed have taken additional measures to retain staff over the past 12 months, with a further 17% expecting to do more over the coming year.

The most effective method of retaining staff, as chosen by organisations and implemented by 65% of those surveyed, was found to be increasing employees’ salaries outside of annual salary review. The second most effective method, and implemented by 66% of organisations, was establishing hybrid working options.

Noelle Murphy, senior HR practice editor at XpertHR, said businesses were facing an uphill battle in recruitment: “Against the prospect of tough economic times for businesses and employees, these results show that the search for high quality staff is as competitive as ever even with the threat of recession. Nonetheless, given that seven in 10 employers receive too few applicants it is clear that organisations have an uphill battle on their hands to compete for top talent.

“There are a number of strategies that organisations can implement in an effort to retain current key staff and make their organisation a more attractive place to work. Increasing employee salaries stands as the most direct and effective method, and will go some way to appease anxieties amidst the cost of living crisis.”

Murphy added that experience had shown that “increasing salaries in isolation is only a short-term fix and employees are more invested than ever in their employee experience. Employers are responding to that and acting on findings from employee engagement surveys, for example preferred hybrid working policy. Of course, employers must continue to ensure, as much as possible, that their overall benefits package and employee experience is fit for purpose to not only retain current staff but to appeal to prospective employees.”

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