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The level of hiring amongst UK medium and large organisations has improved year-on-year, but progress has stalled since the start of 2011 as the worsening economic crisis puts increasing pressure on businesses capacity to recruit, according to the latest & lsquo;Tracking UK Recruitment’ quarterly report by professional staffing recruitment consultancy Barclay Meade.

The report revealed that in Q3 of 2011 the number of firms operating under a recruitment freeze stood at 17%, up from 14% in the three months to June. This figure remains well below the 30% from the third quarter of 2010, but raises concerns that hiring across the private sector may be stagnating. This is supported by a recent decline in the number of businesses reporting they are hiring at above pre-recession levels, down from 16% in Q3 to 14% in Q4.

With UK unemployment reaching a 17-year high in August, it appears growing fears of a double dip recession, which troubles one in five (21%) employers compared to just 15% in Q4 2010, is acting as a barrier to recruitment.

But the report by Barclay Meade – part of the AIM-listed recruitment business Matchtech Group PLC – doesn’t make all bad reading, with 20% of business owners reacting to the current doom and gloom by reporting that they are still very optimistic about the future, the same as in the previous quarter.

This positivity may stem from the 56% of firms which say they are in fact recruiting at similar levels to before the recession, nearly double the 30% from this time in 2010, albeit only a slight improvement from the beginning of 2011 when the figure stood at 50%.

Interestingly, the impact of the much-debated Agency Workers Regulations (AWRs) have had little impact on the vast majority of employers, with a staggering (73%) saying they do not expect the AWR, which came into play on the 1st October, to have a negative effect on their business.

Barclay Meade’s & lsquo;Tracking UK Recruitment’ quarterly report also revealed:

Demand for graduate/entry level job (32%) candidates continues to outweigh demand for senior management candidates (22%) as organisations appear to focus on up-skilling their workforce

Skilled workers are the most sought after employees, with businesses reporting a 20% rise in recruitment in this area, up five per cent on the previous quarter

Only 21% of firms highlighted the skills gap as an adverse recruitment issue, compared to 27% last time round

Nearly one in 10 (8%) employers are unaware of the Agency Workers Regulations, which came into play on 1st October

Nigel Lynn, managing director of Barclay Meade, says: “The tracker shows continued instability within the economy is causing a rise in the number of businesses implementing a freeze on recruitment, while official figures show an increase in unemployment in the UK to a level not seen since 1994.

“Confidence appears to be a major factor affecting hiring levels at present. As increasing numbers of businesses fear the threat of a double dip recession, employers are thinking twice when it comes to taking on new staff. This caution is clearly slowing down the hiring process within many firms. On top of this, many employers say the expense of hiring more staff is preventing them from recruiting new candidates, potentially adding to the dip in graduate and entry level recruitment identified in the report.

“However, while at one end of the scale many firms are really struggling to keep afloat due to tough economic conditions, there are others that are doing extremely well and continue to recruit talented staff. To this end, it is vital the recruitment industry understands the precise needs of companies, whatever position they are in, as the cost of making a wrong hire can be high for any firm.”


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