Employers have showcased increasing optimism towards the economy with business confidence turning positive for the first time since June 2018.
New data from the Recruitment & Employment Confederation (REC) investigates the positive impact that the easing of lockdown restrictions has had on the economy.
The research shows that, in the three months leading up to May 2021, business confidence in the UK economy turned positive for the first time in several years.
During this time, employer confidence in business surged by 21 points to reach +11 which is the highest level recorded since July 2016.
In light of this, more businesses have either considered retaining or expanding the level of staff they are hiring.
Hiring intentions for temporary agency workers increased to +24, rising by 6 points. Within May alone, this surged to +39 – showing the clear impact that planned lifting of restrictions has on recruitment and the wider economy.
Similarly, demand for agency workers in the medium term (over the next 4-12 months) also rose to net: +24, markedly higher than the same period last year.
However, employers’ intention to hire permanent staff remained relatively stable compared to previous months, both in the short and medium terms.
In addition to this, contrary to ideas of hybrid working, almost two-thirds of employers (63 per cent) expect no change in their employees’ working location once restrictions are eased, compared to before the pandemic.
Neil Carberry, Chief Executive of the REC, said:
This surge in employers’ confidence in the UK economy is remarkable – an improvement of 61 percentage points from the previous quarter as restrictions were lifted and businesses started to open again. Positivity about hiring has steadily improved alongside that, and we are now seeing the highest levels of confidence for five years.
However, we are seeing labour and skills shortages across the economy right now, which the pandemic has made worse. These could threaten to slow down the recovery if not addressed quickly. It’s vital that companies and governments come together and improve access to training and support for everyone who needs it, so that jobseekers are able to find work in those sectors that are growing.
*JobsOutlook is produced by the REC in partnership with Savanta ComRes. Savanta ComRes interviewed 600 UK employers involved in hiring by telephone between 8 March and 28 May 2021.
Monica Sharma is an English Literature graduate from the University of Warwick. As Editor for HRreview, her particular interests in HR include issues concerning diversity, employment law and wellbeing in the workplace. Alongside this, she has written for student publications in both England and Canada. Monica has also presented her academic work concerning the relationship between legal systems, sexual harassment and racism at a university conference at the University of Western Ontario, Canada.