13% decrease in available jobs MoM, finds Morgan McKinley London
Morgan McKinley London has released its Employment Monitor for April 2016.
The monitor revealed that there has been a decrease of 21% year-on-year for available jobs, with available jobs decreasing 13% month-on-month. There was a decrease of 25% month-on-month in job seekers, but an increase of 44% in job seekers year-on-year.
The number of available jobs decreased from 8,325 in February to 7,215 in March for a decrease of 21%. Job seekers, who were passive in February, now withdrew from the market, with a decrease of 25% from 17,219 in February to 12,998 in March.
Hakan Enver, operations director of Morgan McKinley Financial Services, said, “All the negative news came together in March giving us a rather morose end to the quarter.
“Reports of a slowing economy, redundancies, the Brexit referendum approaching and then the horrific terrorist attacks in Belgium, it’s little wonder that the figures are showing a decrease. With all this in mind, I’m surprised they held up so well.”
“Companies are saying that the quarter 2 (Q2) will be better.
“The referendum is at the end of Q2, so any pickup in jobs activity will be dependent on the polls ahead of the referendum. If it’s very close, we might have to wait for Q3 before hiring gets going again. However, it is quite precarious out there”
“The news about lower growth, lower M&A activity and reduced profits in Q1 is feeding into a general atmosphere of nervousness and job seekers’ desire to look for new opportunities.”
As the June referendum on Britain’s membership in the EU approaches, the debate continues to heat up. A study conducted by PwC on behalf of the Confederation of British Industry (CBI) warned that a Brexit could cost nearly 950,000 jobs and blow a £100bn hole in economy. In GDP terms, this would mean a reduction of 5.5% for the economy and equates to an average loss of around £3,700 for every UK household.
Morgan McKinley says that a Brexit could also have ramifications for Brits living on the continent. The concerns of British expatriates centre around healthcare and the value of their pensions. France has already indicated that if the UK were to leave the EU, Brits living in France would no longer have access to the French healthcare system. “The Brexit is definitely affecting hiring,” said Enver. “Many firms are nervous about the outcome and the possible ramifications. The natural reaction is to put a freeze on hiring and this is what many are now doing.”
The company says that, on the economic front, there was very little positive news as UK businesses face a perfect storm, due to uncertainty over a potential Brexit and a slowdown in China made the headlines. To add to the woes, London’s economic growth dropped to a three-year low. An index of business sentiment produced by Lloyds Bank gave a result of 52.2, only slightly above the 50 mark which indicates a growing economy.
The negative news on the job front came in the form of redundancies. The future of the British steel industry came into doubt as 40,000 steel worker jobs in the UK were put at risk, with Tata Steel announcing it would exit the UK. RBS announced that they would axe 550 jobs and replace them with “robo-advisers”. As the digitalisation of financial services progresses many “old” jobs are at threat, however, new jobs are also being created.
In the financial services sector, disruption is a major subject as firms move from a traditional business model to an increasingly digital one, according to the monitor. Deloitte is forecasting a fundamental shake-up of financial services, predicting that banks will become more reliant on third party providers for non-core infrastructure. However, new digital and disruptive services do not necessarily mean the end of traditional jobs. For example, instead of killing off the recruitment business as some predicted, LinkedIn has partnered up with recruiters to provide them with data to help in matching job seekers with available jobs. In fact, there appears to be no slowing down in the Fintech sector.
“Fintech firms are still hiring actively and they are able to attract top candidates,” commented Enver. “Many job seekers see Fintech firms as more creative and innovative than traditional banks. Also, the younger generation of professionals are a lot more entrepreneurial than their predecessors. Fintech fits into that mindset perfectly.”
As proof of this trend for a better work-life balance, a quarter of Britons claim they would take a pay cut for fewer hours according to a study think tank, Centre for the Modern Family, funded by Scottish Widows. Enver added, “Although the salaries tend to be lower than in banks, the fact that Fintech firms generally offer a better work life balance is also a big motivator.”
The average salary for those professionals moving from one organisation to another was 22% in March 2016. Despite the volume of opportunities falling, those moving to other institutions are finding themselves securing strong increases on their basic.