JOBS MARKET RECOVERY SET TO STALL IN EARLY 2011
JOBS MARKET RECOVERY SET TO STALL IN EARLY 2011
Employer confidence forecast to fall whilst competition for positions grows
New figures released today by the Totaljobs Barometer reveal that following an increasingly strong recovery across 2010, the jobs market is forecast to stall in early 2011.
The analysis of recruiter and jobseeker activity, across 32 sectors, shows that the supply of jobs has grown by a fifth (19%) since the start of 2010, down on pre-recession peaks and is forecast to contract again in early 2011. The recovery in 2010 has been led by sectors such as sales, customer services, IT, and retail. However, competition for positions has continued to grow due to a record number of people returning to the jobs market, pushing applications per job to an all time high of 19 in November 2010.
The Totaljobs Barometer provides one of the most comprehensive representations of supply and demand in the UK job market importantly reporting three months ahead of official ONS statistics for which it has proven a reliable guide. Based on the behaviour of 2.8 million jobseekers and 9,000 recruiters each month, todays figures show how UK recruitment has fared in 2010 as well as providing analysis into how the labour market is set to change as we move into 2011.
John Salt, Director, totaljobs.com commented on the figures:
2010 has been a story of a long hard climb to reach the peaks of job supply we last saw back in summer 2009. Unfortunately the New Year looks certain to see us sliding backwards, with external influences such as the VAT increase and instability in the European markets set to hit both employer and consumer confidence. We expect a contraction in job supply at the beginning of the year as businesses wait to see how the UK economy performs. However, although the labour market is likely to be uncertain in the first quarter in 2011, we see it recovering later in the year, with key service and support sectors such as sales and administration and PA roles leading the upturn.
The 2010 story of recovery
Throughout the year dramatic changes were charted in job seeker behaviour with the average number of job applications jumping from 16 per job posting in January to a record high of 19 in October. This is set to stabilise in December at around 17 job applications per job posting. This stabilisation reflects the usual cooling of job seeker searching over the Christmas period, with the number of job detail views for November falling 5% on the previous month.
Inevitably, the change in Government and its stated position on Public Sector employment created further pressures in 2010, with job applications in the Public Sector rising 7% compared to the beginning of the year. However, the private sector has also suffered with the construction and electronics industries seeing a respective 5% and 2% decrease in jobs available over the same period. This is attributed to external influences such as demand for new houses dropping and applications for mortgages falling by 9%. On the upside, sectors such as retail, customer services, banking, insurance and finance have seen the biggest increases in jobs available in 2010 increasing by 35%, 32%, and 31% respectively perhaps indicating pockets of job creation in early 2011.
Across the UK the picture is more complicated, with many areas experiencing a fall in the number of jobs posted in November against the start of the year. The North West and the South East saw competition for jobs rise from 8 and 16, to 16 and 27 applications per job respectively. London in contrast saw only a small 3% growth in the number of jobs posted in 2010, and finished the year on 19 applications per job.
John Salt, comments: 2010 saw the beginnings of a shift in the labour market with a decrease of full-time jobs being off-set by an increase in part-time roles. This change signals a move towards a more flexible labour market that is favoured by many of the Nordic countries. By implementing this model, businesses can react more rapidly to external pressures in a more unstable labour market.
Totaljobs.com job forecast for 2011
Areas where public sector employment is high - North East, Northern Ireland and Scotland will struggle - leading to an increase in those out of work for several months. Complementary research from Totaljobs.coms jobseeker confidence survey shows that Public Sector jobseekers must reappraise their priorities to secure jobs 43% were only willing to travel up to one hour a day for work, in stark contrast to private sector job seeker attitudes where 33% were willing to make a commute of at least one hour.
John Salt continues With an unsure start to 2011, there is the real possibility of a 'talent exodus' as more people look abroad for jobs. As companies such as KPMG and the big four continue their European-wide recruitment drive, the issue of key skills leaving the UK is real. We also expect there to be further pressure for private sector jobs early in the year as the nation looks to them to pick up the slack from the public sector cuts this year.
Scott Corfe, Economist, CEBR: The findings of the Totaljobs.com barometer support our view that the UK labour market recovery is still not a done deal, with intense competition for what job vacancies are available. Looking forward to 2011, concerns about the implications of government spending cuts and tax rises may reduce business appetite for taking on new workers.