Category: Recruitment Agencies

Net employment outlook at third strongest in Europe

According to the latest ManpowerGroup Employment Outlook Survey, employers across Ireland anticipate the highest level of hiring in 17 years, for the fourth quarter according to The Net Employment Outlook for Ireland stands at +34%, the third strongest in Europe. The powerhouse area behind this positivity is the manufacturing sector – up 53 percentage points from the previous year to +39% for Q4 2021.

Transport and logistics is also poised for headcount growth, with employment outlook rising to 39% for the coming quarter. The retail sector also intends to hire significantly, bouncing back with the promise of continued government employment supports for the industry remaining in place until March 2022.

Elsewhere, the finance and business service sector remains strong, up ten percentage points on last quarter to +20%. However, the construction industry is being hit by limitations to supplies and hiring plans and has contracted 19 percentage points from last quarters record high, yet the employers in the sector remain optimistic with a hiring Outlook of +20%.

  • Nationwide, employers in all industry sectors report positive hiring plans for Q4.
  • From a regional perspective, employers in Dublin are reporting positive hiring intent with an outlook of +39%, with Munster being the most positive province for the next quarter at +44%.
  • Larger-sized organisations (250+ employees) are reporting the strongest hiring confidence for Q4 with an employment outlook of +39%.
  • Currently 69% of employers are struggling to fill roles. This leaves us with a significant talent gap where employers need to be investing in recruitment drives, upskilling and retraining programmes as long-term solutions to filling roles.

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Recruiters report difficulty in sourcing candidates

A survey conducted by the Recruitment & Employment Confederation (REC) reported that nine in ten recruiters (88%) say that labour shortages are one of their biggest concerns for the remainder of 2021, while skills shortages are a major concern for two in three (65%).

With shortages hitting every sector of the economy and many staffing companies reporting the tightest labour market they’ve ever experienced, the REC is calling on business and the government to take urgent action to solve the problem.

Recruiters have a significantly higher number of roles to fill than before the pandemic, with three in five (58%) having at least 30% more vacancies than pre-pandemic. Of the 191 recruiters surveyed, almost all (97%) said that it was taking longer than usual to fill those vacancies, compounding the problem. Half (50%) reported that it now takes more than a month to find suitable candidates.

Recruiters reported several factors were affecting their ability to source candidates. The top reason was skills shortages (cited by 65% of respondents), followed by the new immigration rules (57%) and their clients not being able to offer competitive salaries (53%).

In response, the REC has set out a number of asks for both government and business to help solve this crisis:

  • Set up a cross-government forum including the Business, Education and Work and Pensions departments, as well as business organisations. This would restore the importance of workforce planning in the economic debate between business, government and other stakeholders, not only focusing on skills.
  • Broaden the apprenticeship levy and increase funding for training at lower skill levels. This would improve progression and transition opportunities for lower-skilled and temporary workers who need them most, and encourage business to do more here in the UK, not less.
  • Allow flexibility in the point-based immigration system and a visa route for lower-skilled workers, which would allow firms in the worst-affected sectors like logistics to access staff at times of pressing need.
  • Increased focus from businesses on workforce planning, staff engagement, attraction and retention policies. Firms need to raise workforce planning up to the senior leadership level, and work with key professional partners like recruiters to boost performance, productivity and staff wellbeing.

This also follows recent research from British Future, which found increasingly positive public attitudes towards immigration. Two thirds of the public (65%) agree that employers should be allowed to recruit from overseas for roles in shortage – showing that a more flexible immigration system would be popular as well as helping businesses to fill crucial vacancies.

Kate Shoesmith, Deputy CEO of the REC, said:

“Worker shortages are a huge problem for employers and their recruitment partners, across all industries and regions. Vacancy numbers are far higher than pre-pandemic, and it is taking much longer to fill them. This is putting the recovery at risk by putting capacity constraints on the economy, as last week’s GDP figures showed. In our survey, recruiters also highlighted a wide range of factors that have combined to cause these shortages – this is a complex problem with no one easy fix.

“As such, we will only solve these shortages through a collaborative approach. We’re glad that multiple government departments are coming together in a joint forum to tackle the issue, but to be effective it must also include business and industry experts. Government must allow more flexibility in the immigration system so firms can hire essential workers like drivers from abroad, and also improve training opportunities for lower-paid and temporary workers. Meanwhile companies need to focus on how they will attract and retain staff through improved conditions and facilities, not just pay.”

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Job vacancies rise to over one million to set new record

New data from the Office for National Statistics (ONS) shows that employment has returned to pre-pandemic levels, with August payrolls showing a monthly increase of 241,000 to 29.1 million. The number of job vacancies in the three months to August has also risen above one million for the first time since records began in 2001.

Speaking to the BBC, ONS deputy statistician Jonathan Athow, warned that well over a million are still on furlough and the recovery is not even, with London still down, young workers disproportionately affected, and sectors like hospitality slower to recover. The biggest rise in job vacancies was in the food and accommodation sectors, up by 57,600 in August.

While the overall unemployment rate fell from 4.7% to 4.6% in the three months to July, this is against the backdrop of acute talent shortages. Various trade bodies, including the British Chambers of Commerce, blamed Brexit and Covid for declines in labour supply and warned that ‘the end of furlough is unlikely to be a silver bullet to the ongoing shortages’.

Neil Carberry, chief executive of the Recruitment and Employment Confederation said: “The Government has convened a cross-department forum to tackle these shortages, but this will only be effective if industry experts are involved as well. Government must work with business to improve training opportunities for workers to transition into the most crucial sectors and allow some flexibility in the immigration system at this time of need. And while businesses are raising salaries in many sectors, they must think more broadly about how they will attract and retain staff through improved conditions, facilities, and staff engagement, working with recruiters, who are the professional experts in all of this.”

Tania Bowers, Legal Counsel and Head of Public Policy at APSCo, added: “The fact that pay has returned to pre-pandemic levels at last is a positive sign for the economy, however, we are seeing employers simply needing to increase remuneration as staff shortages continue to impact hiring activity. The increasing dearth of talent that businesses across the country are reporting is a real concern to the recruitment sector.”

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Primis, a new technology recruitment company that will operate out of the UK and the US will focus on improving the D&I landscape in the technology sector. The announcement was made by APSCo member and Managing Director of Premier Recruitment, Ben Broughton. Broughton who assisted in growing the firm to revenues of £30m, said that Primis will also offer D&I and unconscious bias training to the hiring managers of Primis clients and their own employees.

The people-centric approach the business appears to be focusing on comes at a time where D&I is deemed an important factor in talent retention as a sense of belonging is increasingly more important to employees when looking for a company to work for.

Primis’s training solutions is delivered by a team that includes: Faisel Choudhry, a strategic management professional with experience working at The Royal Household and The Bank of England; Chikere Igbokwe, an Executive Recruiter and D&I Leader and Jina Etienne, who became the first national leader for D&I at Grant Thornton, in the USA.

Broughten commented: “We want to educate and expand the views of tech communitites across the UK and US when it comes to hiring diverse teams. We are a growth business and will achieve this through a mixture of senior hires as well as organic growth through a structured training academy.”

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NASDAQ listed Staffing 360 Solutions, Inc., which is leading an international buy-integrate-build strategy through the acquisition of domestic and global staffing companies in the US and UK, has announced that Longbridge Recruitment 360 and The JM Group have joined to form The JM Longbridge Group.

The JM Group and Longbridge Recruitment 360 have been delivering recruitment solutions for a combined 57 years and form part of Staffing 360 Solutions Inc. In that time, the two firms have continued to grow by extending client partnerships across the full range of its offerings in the Technology, Finance, Business Transformation, Digital, Legal and Data markets.

Simon Girven, MD of JM Group, said: “Bringing the two brands together enhances our client offering, provides career opportunities for our team members, and supports the evolution of our business. With identical working practices, plus a shared commitment to client and candidate service, we will work methodically and diligently to continue to secure the talent our clients need and deliver increased value to the candidates who entrust us with their careers. It’s a great time to join The JM Longbridge Group”.

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Despite new IR35 regulations and guidance in April, and the Department of Work and Pensions and Home Office hit with fines of £87m and £29m, respectively. HM Courts and Tribunal Service has fallen victim of CEST misuse with a total fine of £12m.

Commenting on the latest Check Employment Status for Tax (CEST) casualty, Dave Chaplin, CEO of IR35 Shield said: “HMRC’s CEST tool is failing fast and now we are hearing of yet one more government department, HM Courts and Tribunal Service, hit with a high tax bill to the tune of £12m because it has relied on CEST to assess its contracting workforce. One of CEST’s major flaws has been its over-reliance on substitution, which any defence expert knows is folly. Over the last few years, many industry experts have pointed out CEST’s failings to HMRC but those messages were ignored and now we are witnessing the fallout and financial damage.

“My advice to anyone who has used CEST is to revisit your determinations and if they rely on a valid right to substitute then seek advice on the correct interpretation of the law. Also, recheck the status with the assumption that the substitution clause is not valid, to make sure you have not also been badly exposed due to the flaw.

“Moreover, it is crucial that once you hire a worker on an “outside IR35” basis that you continue to monitor the status throughout the engagement. Regular checking and gathering contemporaneous evidence are crucial in forming a pre-emptive defence.  Poor assessment decisions left alone, without any evidence to back them up, can prove costly as we are seeing with these recent governmental departments.”

The FCSA, the membership body dedicated to raising standards and promoting supply chain compliance for the temporary labour market, responded saying that it had expressed its concern to HMRC about the validity of the CEST tool. “The current fines perhaps demonstrate that the CEST tool needs re-visiting in terms of a valid SDC determination. In the light of the current outcomes, it would be silly for HMRC to simply press ahead without stopping and reviewing the tool.

“In the interim, marketplace experts, including many FCSA members, have developed alternative tools that can assist the sector in creating more accurate determination tests. So far, there is an ironic pattern emerging here in that one government department is taking money from another and so the government balance remains at zero. The real threat comes when other non-government bodies start to fall victim to huge fines because of using a government promoted test. That will not sit well with a sector that is working hard to support the government to ‘Build Back Better’.”

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With job vacancies hitting record levels in July, according to ONS, and Broadbean Technology revealing that application numbers have consistently dropped over the last three months, employers are turning to those candidates who came a close second in the hiring process in a bid to address talent shortages, according to talent outsourcing and advisory services provider AMS.

 

Those who have previously made the hiring shortlist are an appealing esource to employers but eraching out to them and attracting their needs needs to be handled with care.

 

Steve Leach, Regional Managing Director, UK & Ireland, at AMS commented: 

 

“Tapping into this talent pool is certainly a strategic move that we’re pleased to see organisations embrace, after all, these individuals have already engaged with the brand and have some connection to the business. However, how these individuals are engaged does require careful management. Their prior experience in the recruitment process and how their rejection was handled could impact the success of this interaction – and certainly highlights the critical importance of a positive candidate experience for future-proof businesses.

 

“The process of re-engaging with this talent community in order to fill resourcing gaps needs to be both personalised and streamlined. They can’t just be approached as a warm lead or even as a brand-new connection. They need a tailored approach that speaks to their prior experience with the business and convinces them why they should give the firm another chance. Technology can certainly play a key role in streamlining engagement with these individuals and, if implemented correctly, will provide a positive experience for these silver medallists, but the key to successfully enticing this group back to a brand lies in tailored engagement strategy designed solely for their needs and prior interaction.”

 

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The new partnership has solidified the place of video conferencing in the talent recruitment industry.

Global recruiter Hays has partnered with specialist tech provider Odro to deliver video interview and engagement technology to over 1,800 recruitment professionals across the UK and Ireland (UK&I).

The contract is a significant win for Odro, which has over 700 clients worldwide and more than 10,000 platform users. It comes just two months after the company announced an impressive £5.2m cash injection from UK investor, BGF.

Hays’ confidence in Odro is not only an endorsement for the business but the increasing importance of video software in the industry. The technology offers asynchronous and two-way interviewing, digital shortlisting, video sales messaging and content production.

Commenting on the partnership, CEO of Odro, Ryan McCabe said: “We’ve been really encouraged at signs that the industry is bouncing back and it’s great that video has firmly cemented its place as a must-have in the modern-day recruiter’s toolkit.”

Hays Group employs 10,000 staff in 33 countries and in the year to June 2020 placed 66,000 candidates into permanent jobs plus 235,000 people into temporary roles.

Roddy Adair, Director at Hays, said that it is constantly looking for ways to improve and upgrade their tech offering to support their staff in their daily operations. “We were really impressed with the implementation process and the approach by the Odro team from the outset,” he said. “Feedback from the pilot was incredibly positive, with great results and our existing clients have reacted really well to our new way of working, which has significant efficiency benefits for their businesses too.”

Odro has been shortlisted in four categories for the 2021 TIARA Talent Tech Star Awards, including the Optima Talent Tech Leader of the Year.

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HMRC has firmed up off-payroll legislation with new guidance issued in April.

With more employers and recruiters exploring IR35 solutions, HMRC has issued new guidance on Statement of Work to help them and contractors to avoid future liabilities.

“I’m aware of many incidents where Statements of Work are wrongly seen as a magic bullet to disapply off-payroll legislation and there has been a sharp increase in supposed ‘IR35 solutions’ which are simply a change in contractual wording in how someone is engaged,” said Julia Kermode of IWORK, a champion of independent workers and former CEO of the FCSA.

“My advice is simple – be very wary of these models. If a service is genuinely contracted out then a statement of work is perfectly acceptable, however simply amending the contractual wording in isolation does not achieve this and it is likely that you will need to consider the off-payroll working rules. There is no work around or solution to off-payroll, and the sooner everyone realises that the better.”

Clarke Bowles, Director of Strategic Sales at Parasol Group observes that the new guidance from HMRC on SOW has come at an interesting time.

“It would seem to be a reaction to some of the behaviours we’ve seen across the industry since the IR35 reforms in April,” he said. “How you assess IR35 is exactly the same for SOW as it is for any other engagement. Therefore, if something is genuinely outside of IR35 so long as it is accurately and fairly assessed it will be outside for both as it should always reflect the contracts and working practices, so there is an argument that actually getting to the root of the issue and amending contracts and working practices could be a better approach for many and one worth considering.

“Using a Statement of Work for genuinely outsourced services is a sensible way to ensure that expectations and responsibilities of parties are agreed and documented if it reflects the reality of commercial arrangements. However, as a way to circumvent the reforms, it is inappropriate and introduces unnecessary risk.”

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The number of applicants per vacancy (APV) declined significantly across three key sectors in the first half of the year as vacancies have surged, according to data from Broadbean.

Across manufacturing and production, vacancies rose by 32%, while the APV was down 46%. Sectors experiencing the largest fall in applicant numbers were logistics & supply chain and retail, with the former seeing vacancies rise 85% and the AVP decreasing by 60%. The latter saw roles increase by 101% and applicant numbers dropped by 55% between quarter one and quarter two 2021.

Retail has been hit hardest by the so-called ‘pingdemic’, with large employers reporting that entire stores are being forced to shut because of staff needing to isolate.

“The fact that we are seeing applicant numbers fall and companies starting to really struggle to recruit is worrying and could hamper the UK’s ability to build back after the pandemic,” said Alex Fourlis, Managing Director at Broadbean Technology. “And while we expect applicant numbers to pick up once again in September after the usual summer lull, the next few weeks will prove a testing time for the employment market, particular given the huge numbers of people isolating.”

The latest Report on Jobs survey by the REC and KPMG showed that recruitment activity continued to rise sharply across the UK at the start of the third quarter, with permanent and temp billings both rising at near-record rates and starting salaries increasing at the quickest pace on record.

It found that that rising demand for staff as restrictions ended and a further marked drop in candidate supply have accelerated increases in permanent starting salaries, with the rate of salary inflation the sharpest seen in nearly 24 years of data collection. In contrast, temporary/contract staff hourly pay rates rose at the second-quickest rate since the survey began.

Overall, candidate numbers fell at the second-sharpest rate in the survey history, easing only slightly from June’s record, with Brexit cited as a key factor reducing the supply of workers, especially temporary staff.

“While companies want to invest in their business now that restrictions are lifting, demand for new staff still outstrips supply due to low candidate availability,” said Claire Warnes, Partner and Head of Education, Skills and Productivity at KPMG UK. “We know that reskilling and upskilling is needed to help people move between sectors, and there’s no doubt the ‘pingdemic’ has added an extra dimension to the recruitment challenge. Plus, with furlough due to end soon, there may be a downward pressure on pay to come.”

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