New candidates less likely to work remotely
UK’s Net Employment Outlook has fallen to +25% for Q4, according to the latest ManpowerGroup Employment Outlook Survey (MEOS). This figure shows a decrease of eight percentage points compared to Q3 and six percentage points year-on-year.
The MEOS is the most comprehensive employment survey of its kind and is used as a key economic indicator by the Bank of England and the UK Government.
The survey reveals that hiring confidence is still positive across all sectors, but new candidates have less bargaining power, with employers focussing on retaining their existing workforce.
In the survey, 2,030 UK employers were asked whether they intend to hire additional workers, maintain their current headcount, or reduce the size of their workforce in the coming quarter.
For the second quarter in a row, the Banking, Finance, Insurance, and Real Estate sector are in the lead with a Net Employment Outlook of +40%. This, however, is a decline of nine percentage points in Q3 and nine percentage points year on year.
Looking specifically at London, employers report an Outlook of +28% for Q4. This is a decline of 13 percentage points since last quarter. In Q1, employers in London were least likely to ask employees to work in the office full-time. Empty office space in London increased by 51% since the beginning of the pandemic, showing that working from home remains popular despite the increased cost of living, making working from home less affordable.
Chris Gray, Director at ManpowerGroup UK, said: “Employers are keen to get people back into the office, however employees still have a lot of bargaining power.”
“Over the last 12 months we have seen employers offer unprecedented benefits, from hefty signing bonuses to fully remote working, in order to attract skilled candidates. However, as demand for new workers cools, candidates are less able to secure these benefits – but many existing employees don’t want to give them up. One of our clients saw 75% of employees decline new contracts that didn’t guarantee fully remote work. This leaves employers engaged in a balancing act of keeping their existing employees happy while phasing out remote work for new candidates.”
“We’re seeing a shift from candidates holding all the cards to employers now having the leverage to ask candidates to come into the office – at least some of the time. Existing employees are more likely to have the bargaining power to retain their home working benefits, but new candidates will increasingly see pandemic-era benefit offers in the rear-view mirror.”
“As household energy bills hit record levels, trends may shift slightly with existing employees keeping their options open where possible to maintain their bargaining power. Decisions on whether to go back into the office will be based on individual circumstances. This is especially true for employees who moved away from big cities where commuting is most costly.”
“Despite the shift in power from candidates to employers, the fight for talent is still firmly underway, and employers need to meet candidates half-way to attract the best talent. That means offering sustainable benefits like increased annual leave and flexible working arrangements alongside increases in pay.”