Job prospects in the UK are continuing to improve, with the financial services sector leading the way. But new figures also suggest that growing skills shortages are set to hit many employers.
The latest Employment Outlook Survey from employment group Manpower suggests that one in five companies are facing shortages of skilled workers as the forecast Net Employment Outlook for the third quarter of this year - the balance of employers saying that they will be recruiting rather than laying off staff – rose to +14 per cent.
"There’s widespread confidence across UK business sectors," said Manpower's Hazel Detsiny. "The news from the finance and business services sector - based primarily in London and the South East - is encouraging."
The Employment Outlook Survey, which measures employer hiring intentions for the quarter ahead, found that employers in the financial services sector are reporting their highest third-quarter hiring intentions since 1998.
"We believe some of this intention to hire is influenced by a perceived need to employ additional staff to cope with stricter controls and legislation within this industry," Hazel Destiny added. "However, there is also increased economic confidence and business growth."
At the same time, employers are still reporting that it is hard to find staff with the right qualifications. Further research conducted by Manpower indicates that just over one in five (21 per cent) of UK employers are faced with skill shortages.
Detsiny also believes the recent enlargement of the EU could provide a wider labour pool for UK employers, which could contribute towards tackling the skills gap:
"Contrary to much speculation, the recent expansion of the EU hasn't yet resulted in a flood of migrant labour. However, there is an opportunity for employers to tap into new pools of labour from new member states.
"Our research also shows that one in five employers would consider employing someone from the accession states to help fill this need. In the short-term, however, lack of skills in many sectors is likely to persist," she said.
Most of the industry sectors surveyed by Manpower said they were planning to take on staff in the next few months, including those in transport, manufacturing, construction and finance. But the Hotel and Retail sector - often seen as a good indicator of consumer confidence - has declined by six percentage points over the last quarter but still shows a positive Net Employment Outlook of +10 per cent.
Employers in East Anglia were the most optimistic, while those in the West Midlands and the North West were least likely to be hiring new staff.
Of the 11 European countries surveyed, as in quarter two, all except Germany (-4 per cent) reported positive hiring intentions. The strongest outlooks in Europe are reported in Ireland (+18 per cent), Sweden (+16 per cent), Spain (+14 per cent), and the UK (+14 per cent).
Globally, 18 of the 19 countries surveyed anticipate positive Net Employment Outlooks for the three months ahead, with New Zealand (+30 per cent) and Canada (+25 per cent) reporting the most buoyant forecasts. Employers in 16 of the 19 countries also expect more hiring compared to this time last year.