Job vacancies have risen above one million for the first time since records began and now far exceed pre-pandemic levels, but skills shortages are still a cause for concern.
There were 1,034,000 jobs on offer in June to August 2021, some 269,000 more than the previous quarter and 249,000 more than were available in January to March 2020, the latest labour market figures from the Office for National Statistics show.
There was an increase across all industry sectors, with the majority seeing the highest number of jobs available since records began in 2001. The largest increase was seen in accommodation and food services, where the number of jobs on offer rose by 75.4% (57,600).
There were 3.4 vacancies for every 100 employee jobs, also a record high.
While the headline jobs market figures, alongside the rise in the number of payrolled employees (29.1 million) and a drop in the unemployment rate (4.6%), suggested that the UK jobs market was recovering after a year of uncertainty, industry bodies highlighted that many of the additional jobs were unlikely to be permanent and that hiring difficulties remained.
CIPD’s senior labour market advisor Gerwyn Davies drew attention to the fact that the number of temporary jobs had risen by 9% since the onset of Covid-19, with the number of temporary workers in employment rising to a five-year high (1.36 million).
“The sharp increase in temporary employment suggests that there’s more employers can do to address rising labour shortages. Candidates want more than a job; they also want some level of security after such an uncertain period. Rather than sitting on the fence, we need employers to bite the bullet and make more permanent hires where they can, to give candidates confidence and to fill the huge number of vacancies out there,” said Davies.
“As well as creating more permanent roles, employers should consider a range of tactics to make their roles more attractive to candidates. For example, through improved pay and working conditions and flexible working options.”
Dr Joe Marshall, chief executive at the National Centre for Universities and Business, said: “As was the case last month, today’s statistics show a disproportionately high number of vacancies, alongside large numbers of people still furloughed and unemployed.
“There are worrying signs that employers across a multitude of sectors are currently facing difficulty in hiring. Businesses and higher education providers are therefore voicing serious concerns that we are facing a skills mismatch.”
Recruitment and Employment Confederation chief executive Neil Carberry said most individual sectors still had vast numbers of unfilled jobs, which could hamper their recovery.
He said: “There are a number of things we can do to solve this crisis. Government has convened a cross-department forum to tackle these shortages, but this will only be effective if industry experts are involved as well.
“Government must work with business to improve training opportunities for workers to transition into the most crucial sectors, and allow some flexibility in the immigration system at this time of need. And while businesses are raising salaries in many sectors, they must think more broadly about how they will attract and retain staff through improved conditions, facilities and staff engagement, working with recruiters, who are the professional experts in all of this.”
Although the unemployment rate has fallen, the number of people who have been unemployed for more than a year has risen by 34,000 on the previous quarter.
Tony Wilson, director of the Institute for Employment Studies, said: “Today’s figures confirm that the jobs recovery is continuing to gain speed. However they also show that we’ve seen the biggest fall in the size of the labour market since the early 90s recession. Officially, there are still more than half a million fewer people either in work or looking for work than before the pandemic began, although furlough will be pushing the actual figure closer to a million.
“With vacancies setting new records, the biggest risk that we’re now facing is not enough workers rather than not enough jobs. At the same time, there are more than six million people outside the labour market because of ill health, caring or studies. So we need to be doing far more – government and employers – to help more of these people to get into work.”
Madison Kerr, an economist at Pro Bono Economics, said more should be done to help those with lower qualifications and disabilities to find work. “With the government focused on levelling up, it is important to recognise the different challenges across the country. Employment rates have now surpassed pre-pandemic levels in both Wales and the East of England. But they remain some way off that mark in many other parts of the country, with the East Midlands and North West performing particularly weakly,” she said.
“The task of supporting these vulnerable groups will fall to charities that are straining more than ever to aid those hardest-hit by the pandemic. The role of the social sector in this recovery is vital to the government’s priorities of levelling up and ‘building back better’.”