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Lack of Candidates Threatens the Job Market’s Buoyancy

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One in five employers is planning on taking on more staff this year, but many anticipate a shortage of qualified candidates to fill those positions, according to a new report from the Recruitment & Employment Confederation (REC).

Overall, half (51 per cent) of employers are gloomy about the availability of high-quality candidates for permanent positions, with large employers the most pessimistic. 63% of employers with more than 250 staff expect to struggle to find talent. Employers are particularly worried about the loss of talent from EU countries as a result of Brexit, with anecdotal reports of EU staff leaving the UK or turning down offers already circulating.

The shortage of candidates is expected to be most pronounced in engineering and tech, health and social care and construction—sectors where reliance on labour from the EU is high.

The REC’s latest JobsOutlook survey also found that eight in 10 (78 per cent) companies are operating with little to no spare capacity and would need to add staff members if sales increased. That’s despite 59% of companies already increasing their headcount in the last year.

Demand for staff continues to be higher in London, where 28 per cent of companies intend to expand their permanent workforce in the next four to 12 months.

The hiring bonanza reflects growing optimism in the UK economy, with a third (34 per cent) of the 600 surveyed companies believing economic conditions in the UK are improving. 

Kevin Green, chief executive of the REC, said: “There’s a feel-good factor about the UK jobs market. The official figures show record levels of employment, and our data indicates that this could rise even higher in the coming months.

However “the candidate shortage is an ongoing dilemma. This is not a new problem, but the fall-out from Brexit has created fresh challenges,” he added.

He called on the government to clarify the position of EU nationals working in Britain.

“[The government’s approach to immigration must show more clarity. Safeguarding the status of EU workers in the UK in the upcoming Brexit negotiations would help to allay anxieties amongst employers,” he said. 

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