The employment landscape in the UK is undergoing significant transformations amidst economic uncertainties and global conflicts. These factors have created a highly competitive hiring environment, particularly for roles in high demand and those related to AI.
Organizations now have the opportunity to reassess their value proposition and adopt data-driven strategies to better source and retain top talent despite the challenges they face.
The Spring/Summer 2024 Europe Labour Market Report delves into the complex dynamics shaping employment markets in the UK and Ireland, providing valuable insights for organizations navigating the evolving talent landscape. Here are some notable trends:
Macro Environment:
Economic turbulence caused by global conflicts, uncertainty, surging energy costs, and fluctuating inflation and interest rates has led to significant volatility in the UK and Irish employment markets. Rising costs have contributed to a decline in hiring activity amidst this challenging landscape.
In the UK, the job market has become increasingly competitive due to a simultaneous increase in available workers and a decrease in vacancies. Data from KPMG and the Recruitment & Employment Confederation revealed a 5% quarterly decline in estimated UK vacancies for Q4 2023 – marking the 18th consecutive period of decline, continuing into January 2024.
Meanwhile, Ireland has seen a slowdown from the hiring boom experienced in 2021-22, particularly in key sectors like technology and pharmaceuticals. High interest rates have dampened investments in both nations, impacting liquidity and reducing growth opportunities across industries.
Skills in Demand:
The adoption of AI technology in the UK has driven up demand for professionals skilled in AI and machine learning (ML). This aligns with the government’s ambition to position the nation as a global leader in leveraging AI to improve quality of life. Additionally, skills such as software sales, cloud services, and managed security are highly sought-after, reflecting companies’ strategic priorities in today’s technology-centric marketplace.
In Ireland, a housing crisis has led to increased demand for construction workers. Key trends in other sectors include a high demand for technology engineers, particularly in validation and automation, as well as a focus on microbiology and chemistry method testing skills within biopharmaceutical operations. Furthermore, there is an increased need for professionals with expertise in data analytics, data science, and agile project management methodologies across various industries.
Remuneration & Benefits:
Wage growth in the UK rebounded to 6.4% year-on-year in January 2024 following a 3.6% decline in Q3. In contrast, Ireland experienced more moderate growth of 3.7% by the end of 2023, below the Eurozone average.
However, candidates do not solely consider remuneration when evaluating job opportunities. Factors such as remote work policies, holiday entitlements, pension contributions, and opportunities for career progression are also crucial in maintaining a healthy work-life balance. Flexibility plays a key role, with 66% of organizations in the region recognizing the importance of offering flexible working arrangements to attract and retain talent.
