REC webinar sheds light on recruitment challenges

Tuesday 3 June 2014

A recent 'Talking Recruitment' webinar hosted by the Recruitment and Employment Confederation (REC) has shed light on the state of the UK labour market.

Looking at key industry trends, experts discussed the challenges facing businesses and workers, including contractors.

Indeed, despite the fact the UK economy grew by 1.8 per cent in 2013 and employment now stands at a record 30.4 million, there are still problems that urgently need addressing.

Youth and long-term unemployment is still rife and the skills shortage is worsening. The latter problem is intensified by a lack of candidate availability, illustrated in May's 'Report on Jobs' from the REC and KPMG. During April, the availability of staff declined at a quicker rate, falling at the fastest speed since October 2004 for permanent candidates and the greatest rates since December 2000 for temporary workers.

This is putting upwards pressure on pay rates, with permanent salaries increasing by the largest sum since July 2007 and temporary rates continuing to grow at a solid pace.

Bernard Brown, partner and head of business services at KPMG, said: "With starting salaries rising at their fastest rate for almost seven years and temporary placements growth slowing down, people would be forgiven for thinking that the time is right to change jobs. After all, for many months the focus has been around how long employees would wait before deciding it’s time to try something new.

"Yet the truth is far different. The number of people putting themselves on the jobs market has dropped at its sharpest rate since 2004. It is this shortage of skilled labour that is forcing employers to tempt talent with improved pay, rather than new-found confidence."

Changes to onshore employment legislation have also served to make matters slightly more difficult for businesses looking to take on the self-employed.

HM Revenue and Customs is removing the ‘substitution’ clause as a factor in determining whether an individual is self-employed. From now on, employment status is determined by whether a person is subject to direction, supervision or control. However, there is much confusion as to how to prove employment status.

Following a meeting between the REC, HMRC and stakeholders on implementation, the tax body has promised to create an 'evasion' email inbox and give crucial further guidance to help ensure businesses and the self-employed are compliant.

Elsewhere, organisations are still facing challenges when it comes to getting more women on to the boards of FTSE companies.

Figures show that females currently only account for 20.4 per cent of FTSE 100 board memberships - five percentage points below the target of 25 per cent by 2015.

Being able to draw from a diverse workforce has been shown to be crucial for businesses, so work needs to be done to ensure more women can climb to the top.

In a bid to improve conditions the REC has launched the Good Recruitment Campaign, which is designed to create best practices for hiring and 'reinvigorate' recruitment strategies to give candidates a better experience.

By Victoria McDonnell

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