Latest jobs data Nov 22

We work predominantly with early-stage tech companies and have seen a continued flow of tech roles despite the highly uncertain economic climate we find ourselves in. I would even go so far as to say that hiring has been expedited given the plethora of highly skilled candidates who are now available following a number of tech layoffs and redundancy situations. In the tech industry, the demand for skilled workers far exceeds the supply. As a result, employees in this field often hold more power than their counterparts in other industries. They can be choosier about which companies they work for, and they can negotiate for higher salaries and better benefits. We have seen the average salary for a software developer increase this year as remote working now means that candidates outside of London can seek to join a London-based firm and therefore expect the same salary as those living in the City. Sadly, many employees do not feel confident enough to ask for a pay rise and instead look outside of their current employment to gain a higher salary. This has resulted in more counter-offers than we would usually see, given that the cost to replace an employee can quickly amount to tens of thousands of pounds. Where we have seen some of these smaller and perhaps more financially constrained companies winning is in relation to flexibility. Our startup clients have mostly been created during and post-pandemic, where remote working was the norm rather than the exception. A return to office work is one of the key reasons we are seeing software engineers looking to move roles as they seek to maintain the flexible working practices that were accelerated, and in many cases engendered, by the pandemic.

Though there are dark clouds looming over the economy, we're still seeing a huge desire in the candidates we speak with for flexible working. From our recent research conducted in partnership with Working Families, we found that flexibility is second only to pay in terms of priorities for UK parents when looking for a job. And for mothers, flexibility was tied as a top priority alongside pay. Flexibility is not going anywhere and will remain a priority for many employees whatever lied ahead of us. The pandemic triggered a paradigm shift in the mindset of employees and it's one that will not be reversed by the economic uncertainty we're facing. As well as saving them money on office costs, employers increasingly understand that flexible working makes for a happier, and therefore more productive workplace, so it's a win/win for staff and companies alike.

Within the professional services sector, some firms are starting to put a hold on new hires. There is nervousness surrounding the economy, particularly in the tech sector, which ramped up during Covid and has now seen huge numbers of people being laid off. In professional services, there is still a dearth of candidates and the balance of power very much favours employees. That being said, there is a growing worry among jobseekers that it could be last in first out and, with the cost of living crisis and a predicted longest recession on record ahead of us, it's no surprise that many employees are starting to take a ‘wait and see approach’. Across the professional services market, comprising law and accountancy firms, a recent survey by Ambition showed that most firms gave a 3-5% pay increase within the past 12 months whereas if people moved to a new role/firm, they received a 15% pay increase, hence the reason people are still looking at moving firms even if there is an added risk attached of being last, in first out. Many firms have had record years of profits and therefore need to ensure their employees are rewarded fairly to ensure they retain talented employees. We have seen some firms look at pay increases for those employees on lower salaries to meet inflationary pressures. Many other sectors such as commerce, hospitality are struggling to meet the inflationary pay rise needed to help keep their employees' heads above water. I believe we will see unemployment rise in 2023 as the extreme economic uncertainty and sky-high inflation puts more companies into receivership. Employees are still demanding flexibility, as many people still haven’t started to feel the bite of the rise in fuel costs and rising mortgage rates, as their fixed rates have yet to end.The mortgage shock many will experience could see a lot of people view their existing employer in a different light and simply be grateful to have a job. It will be interesting to see if people start to change their mindsets in the coming months, particularly as the rise in fuel costs make it difficult for people working from home to have the heating on all day. It may well be more economical for some to work in the office. There are many conversations about hybrid work models and I have yet to see one firm that has got this right. There is a growing belief that flexible working is here to stay but for younger staff who prefer to be in an office environment, surrounded by experienced people, it is more challenging and taking them longer to learn and impacting their career growth. There is also a discussion around people who work from home not being ‘noticed’ as much as people who are in the office environment and this can impact people’s career development.

As news of tech layoffs spreads, Glassdoor’s data shows that employees are increasingly anxious with the discussion of layoffs doubling and mentions of recession up tenfold from last October. Hiring has also taken a hit, with mentions of hiring freezes up more than 500 percent. However, this isn’t 2008. Unlike the Great Recession, the current shortage of workers is much more acute and even a potential recession would be unlikely to result in the same peak of unemployment that we saw back then. There are reasons to be hopeful. Vacancies are likely to remain higher and both redundancies and unemployment are lower than before the pandemic.

At a time when employees are being hit by the cost-of-living crisis and looking for increased wages, or alternative employment opportunities, hiring is starting to slow down. With the recession looming, companies are under pressure. They're looking for alternatives to offering pay rises to retain employees, such as offering travel, childcare cost reduction benefits. The news is full of reminders that during difficult economic times jobs become less secure. Whilst candidates may want flexibility, their financial circumstances are driving what they're willing to compromise on. The risk is that this comes at the cost of their happiness within their role. If the warning signs of a long recession are realised, unemployment is likely to rise. The important question for employers is how to keep those employees who would usually have moved on engaged. Leaders should have conversations with their employees about what motivates them and how can they best use their strengths. This will create opportunities to increase their productivity and happiness.

I think the health of the jobs market varies dramatically depending on the sector. Across healthcare, social care and education, job vacancies still far outweigh the number of interested candidates. I suspect this is because the challenges of the pandemic drove so many talented education, health, and social care professionals out of their jobs, and out of the sector altogether. These opportunities are far less appealing now than they ever were pre-Covid. In other sectors, there is definitely movement. It's still a candidate-driven market in my opinion, but interest in jobs is on the up.

There is a real risk and reward element to hiring at the moment, as times of economic uncertainty like this are an opportunity for the courageous to grab a bigger market share through aggressive hiring, but no-one knows how long and deep the recession the Bank of England is predicting will be. It's slowly but surely changing from an employee to an employer market again, but with different opportunities available to people post-Covid, I don't believe it will ever be a completely "get what you're given" jobs market again. The general public are more in tune with what they want work-wise now, and are more willing to wait for it, or leave for it. We encourage our candidates to ask for a pay rise first, if money is their only reason for leaving, and if they hit a brick wall and feel undervalued we then actively help them to improve this by looking to the market. We have had an influx of vacancies, as the skills shortage in financial services like many other sectors, is still profound. As the cost of living soars, flexibility is a great perk that works well for businesses that can function well with Working From Home/Hybrid models, but perhaps are not in a position to offer pay rises. This gives a reduction in costs to both businesses and employees, who save on the commute among other things. As companies are starting to get people back in the office, in an ill-thought out panic, I would suggest if it worked in a buoyant post-Covid market, why wouldn't it be the same for a more challenging market? Clearly it all depends on the productivity and processes for each individual business to say whether offering working from home and flexibility will benefit them.