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Tracking Reports

  

Q1 2008 Tracking Results – available now! 

Resilient Labour Market Protecting UK Economy from Outright Recession

New detailed research from the Recruitment and Employment Confederation reveals that its still business as usual for most recruiters and employers.  

The latest official tracking data from the REC’s Industry Research Unit shows that the labour market continues to hold up strongly against more negative economic indicators.   Results from the first quarter indicate that employer demand for temporary and permanent positions remains relatively strong whilst recruitment agencies’ optimism is only slightly down on 2007 levels. 

According to Roger Tweedy, the REC’s Director of Research, the results are positive news that will be welcomed by Government.  “Most commentators view the labour market as a ‘lagged’ economic indicator yet we are still to see a significant dip in demand.  The employers I speak with have not significantly changed their hiring strategies and are not predicting any reduction in their workforce this year.   “As skills shortages continue to intensify, our research shows that businesses are keener than ever to retain their talent pool and they remain cautiously optimistic about future prospects.” 

Headline findings from the research; 

  • Most (68%) employers believe that their use of agency staff will remain the same over the next 12 months whilst 15% think it will increase.  This compares to 57% and 20% respectively for the same period last year.
  • Most employers (56%) expect their permanent workforce to remain stable during 2008 although 35% are still predicting an increase.  In the same period last year, 49% forecast stability whilst 39% predicted growth.
  • Agencies in all sectors saw a decline in permanent placements in the first quarter, reversing the winter lift. Overall, placements were slightly up on the same period last year.
  • The average number of temporary workers out on assignment dipped slightly in the first quarter, reflecting largely seasonal factors.
  • The average number of assignments also fell and the average length of assignments continued the recent reducing trend (from 158 days to 136 days over the year).
  • Satisfaction levels amongst agency workers (87%) and employers (67%) remain strong. In the first quarter last year they were 84% and 60% respectively.  Contentment of agency staff continues to slip slightly as the search to source rare skills becomes more difficult.

 But Tweedy also sounds a note of caution.  “It is still early days and whilst business is currently beating expectations for most recruiters a protracted or severe downturn would change this scenario.  For now, the resilience of the labour market is helping to protect the economy from an outright recession”. 

Adding to this, Tom Hadley, the REC’s Director of External Relations commented:”It is clear from this research that recruitment agencies are playing a critical role in supporting the UK economy during a fragile period.  New legislation, such as the proposed, Agency Worker Directive, could easily undermine this role and weaken economic stability if introduced during the next twelve months’. 

The full results from the 2007 tracking programme are being published this month (May 2008).  For more information and advanced orders please contact Maggie Pattinson on 020 7009 2159 or Maggie.pattinson@rec.uk.com