UK job markets weakens

2002

Recruitment demand has dropped 4 percentage points compared to last quarter, with 82% of organisations in the UK planning to recruit in the third quarter of 2002 according to research published on 15 July by recruitment group Reed.

More than 1,300 organisations across Britain and Ireland were surveyed for the Reed Recruitment Index. Over a third of organisations, 34 per cent, plan to recruit to grow. Nearly half all organisations, 48 per cent, plan to recruit to retain staff levels, and 9 per cent plan to downsize.

Shifts since last quarter’s research demonstrate the slight weakening in the job market. The number of organisations recruiting to grow has actually increased by 1 percentage point, while the 9 per cent downsizing figure is unchanged since last quarter. However, those recruiting to retain staff numbers have dropped back 5 percentage points, perhaps in part because of higher retention rates amongst existing staff. As a result, overall recruitment demand has dropped 4 percentage points compared to the last quarter.

Regional Variations
Regionally the North of the UK appears to be growing at the faster rate than the South, led by Scotland where 91 per cent of all firms are planning to recruit over the third quarter - with more than half (54 per cent) recruiting to grow. Areas which were still growing strongly last year, such as the "Silicon Valley" region around the Thames corridor with its IT focus, appear to be under particular pressure at the moment. In contrast, areas such as the Midlands and the North West are growing at a higher rate than further South.

Skills in Demand
The skills demanded by organisations continue to change. Sales professionals top the list, with demand for their skills rising 1 percentage point compared to the previous quarter. Demand for specialist professionals in Accountancy, Insurance and Engineering has overtaken demand for secretarial staff this quarter, although support staff – at fifth on the list - are still sought after. Demand for IT skills continues to fall, and have dropped by a further 2 points compared to last quarter to almost half the level it was a year ago.

James Reed, Chief Executive of recruitment group Reed, comments: "The job market appears to be weakening, which gives cause for concern. Although at present the change is slight, nevertheless this should sound a warning note for the government. "The UK is still experiencing the lowest unemployment levels since 1975, and outside London and the South East the job market is growing at a reasonable rate. However our research does suggest this may not be a good time for the Bank of England to raise interest rates, or for the government to introduce further tax and red tape burdens on employers."

Notes
1305 organisations were surveyed in June 2002 by Reed. 41% were small organisations of up to 100 staff, 36% medium sized with 101 – 1000 employees and 18% large organisations with over 1000 staff (5% not stated).

Reed, the UK’s leading recruitment group, offers a combination of on and offline services with over 250 branches and 2000 specialist consultants across the UK and Ireland, fully integrated with reed.co.uk, the job site that attracts more than half a million unique visitors a month.

For Press enquiries contact Katy Nicholson on 020 7313 7461, [email protected], or Tim Runacre on 020 7313 7458.

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