Job seeker confidence higher than during the Financial Crash
There is a recession looming, and the tough economic environment is impacting pay and macroeconomic confidence. Yet, despite this, employees and job seekers remain surprisingly optimistic about their job security and career prospects. This is according to the newly released Robert Half Jobs Confidence Index (JCI).
The new index was created in association with the Centre for Economics and Business Research and revealed that while the JCI fell in Q4 2022 to stand at 19.9 – down 7.5 points from Q3 2022 (27.4) – it is up 58.1 points from Q2 2009 during the global financial crisis.
With confidence increasing significantly compared to the last pre-pandemic recession, UK employers are facing a far more challenging talent landscape this year.
The report also suggests that despite consumer confidence and macroeconomic business confidence being affected by the government instability in the third and fourth quarters of last year, employees and job seekers remained optimistic about their job security, job search, and career progression prospects. This confidence likely originates from the tight labour market, with many companies struggling to hire workers with the right skills.
The data revealed that the job security confidence pillar of the index is up by 159.4 points compared to the final quarter during the recession of 2009.
Despite worries around the cost-of-living crisis and the downturn in real wages since 2009, the index points to remuneration optimism, with pay confidence increasing during the last quarter – a jump of 28.4 points, even though the pay confidence pillar of the index was in in the negative in Q4 of 2022.
Confidence surrounding job search, career progression, and remuneration is on an upward trajectory – an unusual sentiment during economic uncertainty. Despite this, Robert Half has warned that businesses will face an uphill battle for talent. Similarly, companies that decide to cut back on staff will struggle to replace them when necessary.
Matt Weston, Senior Managing Director UK & Ireland, at Robert Half, commented: “There’s no shying away from the fact that whilst the UK economy is facing challenges ahead, however our Job Confidence Index doesn’t paint the picture of labour confidence doom and gloom that one may expect as we head towards a recession. The fact that our data reveals that employees are confident about both their job security and job search and progression prospects suggests that we are going to experience an atypical downturn.
“However, with the complex macroeconomic environment impacting business confidence in recent months, we have already begun to see changes to talent strategies that we predict will continue. Employers have had to be more innovative than ever before when planning and managing human capital, and we expect companies to lean on more agile flexible staffing models, as well as developing permanent employees through upskilling and reskilling programmes.
“One thing is for sure, though, investment in existing workforces, and developing compelling attraction strategies will be crucial to ensure that employers have access to the skills they require in what will continue to be a tight labour market.”