Why did I write this article?

A few weeks back I was out with a group of friends, one of who has been out of work for a number of months. He has never been unemployed before, and on the face of it, he’s loving his free time, seems to be in no hurry to get back into work and is relaxed about the situation.

Appearances can be deceiving.

He asked for my view on the employment market, and I gave him an honest assessment.

“It’s tough out there”

I didn’t go into the detail you will see below but didn’t sugar coat what I was seeing first hand. To my surprise there was a palpable look of relief on his face.

“it’s actually really good to hear, I was worried it was just me”

LinkedIn is a fantastic platform for jobseekers and I’m all for celebrating success, but it needs to be genuine. I get that companies want to promote themselves and give the impression that they are rocking it……. but the example really hit home and highlights how some of the self-promoting content spurted out daily, is misleading jobseekers and leaving them questioning themselves.

“From what I’m reading on LinkedIn the market is Buoyant, yet no one is knocking on my door”

Like all forms of social media there are huge positives to be had but not everything you see is real. It is no different to the rose-tinted view we get of others perfectly manicured family lives on Facebook or Instagram. If a recruitment company is really busy and they are posting to tell everyone how rushed off their feet they are, how did they find the time to post, why did they post and why are they also touting for new business? A rhetorical question I know. The key point here is that people do believe what they see on social media, they do compare themselves and it does impact mental health. Anyone who spends time on LinkedIn will see a barrage of daily click bait proclaiming….

“never been so busy! Get in contact, my inbox is bursting with jobs, feeling very confident about the market, don’t delay call me today!”

“the sun is shining, here’s a picture of me at weekend in a field with a hat on, I’ve just got back from holiday and we have just been instructed on 217 exclusive jobs working for a high growth scale-up, multi-award winning, universe leading employer of choice who offer mind blowing salaries and as much fresh fruit as you can get your hands on… the market has turned, get in contact!!!”

OK, so I have exaggerated a little (!) but you get the idea ……let’s now deal with some facts and then I will share what I have seen on the ground.

Firstly, some context. Broadly speaking there was a post COVID bounce which saw a huge spike in recruitment activity. There was a lot of pent-up demand, a shortage of candidates and loads of jobs that needed filling in under resourced teams and burnout departments. We saw a war for talent, eye watering salary increases and lots of movement in the market. This recruitment frenzy ended mid-2023 and the UK labour market has since witnessed consecutive falls in the majority of employment metrics ever since. It’s been steady at best.

What are the FACTS and Figures?

A selection of headlines from the latest ONS (Office for National Statistics) Labour Market Summary September 24.

• The number of vacancies in the UK decreased this quarter for the 26th consecutive period.
• Total vacancies are down 14.3% year on year although 7.7% above pre-Covid levels.
• Annual growth in total earnings sits at around 4.0%, in reality this is likely lower given a number of one-off payments within the public sector last year.
• In real terms total earnings (when adjusted for inflation) is closer to 1.1%.
• UK employment sits at around 74.8% is below estimates for the year but marginally increased last quarter (are we turning the corner?).
• Unemployment sits at around 4.1% and has marginally decreased (right way).
• UK economic inactivity (people not looking for work) sits at around 21% and whilst pre-Covid was trending down it has largely been trending up since COVID (largely the wrong way for economic growth but decreased last quarter so a positive sign?)
• Redundancy numbers down quarter on quarter and down year on year (positive)
• UK temporary workforce is down by 9.1%.

The FACTS suggest a mixed bag but clearly a tough market, steady at best with a spattering of small positive trends. What have we seeing on the ground?

• More talented finance and accountancy professionals on the side lines that would have been snapped up a year ago.
• Hiring intent isn’t translating to job flow yet.
• Salaries have levelled out after the post-COVID silly season where we saw what looked like unsustainable salary hikes as companies tried to outbid each other to secure talent.
• Our counterparts in the talent acquisition / in-house recruitment space are reporting many of their colleagues being out of work and struggling to find new roles and in some cases resorting to lower paid jobs.
• Recruitment Agencies (within the Accounting and Finance space) with publicly listed financials are typically showing net fee income is down typically 15-20%.
• Our clients who operate within the M&A space are experiencing a general lack of deal flow.
• We are seeing an increase in protracted recruitment campaigns and jobs being pulled. Plenty of wavering.
• For the time being the tide has somewhat turned from what was very much a candidate led market post COVID.

 

Looking Forward and Summary

Key economic forecasts seem to point to some cautious optimism with inflation seemingly under control at around 2%. GDP looks like it will hold at a modest 1% growth for the year. Are we at a turning point in the economic cycle and the prospect of further interest rate cuts?

The key questions now is what can Labour do to promote growth and what will they do at a time when businesses need a confidence boost to start investing?

In the meantime, let’s celebrate the wins when they come, look out for each other and try to be a little more real on a platform (LinkedIn) where people come to both progress their career but also to find jobs to pay their bills and support their families.

To my friend who is still out of work, and to all the people who need to hear it, the market is still tough and it’s not just you. It will come back.