City Job prospects help keep UK employer hiring confidence buoyant

Employers in the financial services sector are reporting their highest third-quarter hiring intentions since 1998, helping UK job prospects achieve a Net Employment Outlook of 14%, says the latest Manpower Employment Outlook Survey. However, a shortage of skills in some sectors means many employers are constantly trying to fill long-term vacancies.

Hazel Detsiny, director at Manpower, comments: There’s widespread confidence across UK business sectors. The news from the Finance and Business Services sector - based primarily in London and the South East - is encouraging. We believe some of this intention to hire is influenced by a perceived need to employ additional staff to cope with stricter controls and legislation within this industry. However, there is also increased economic confidence and business growth.

The Manpower Employment Outlook Survey measures employer hiring intentions for the quarter ahead: July to September 2004. 2,500 UK employers were surveyed in the UK and over 35,000 employers in 19 countries and territories globally. The Net Employment Outlook for the UK in Q3 is 14%. When seasonal variations are taken into account, the Outlook is 12%.

At the same time, employers are still reporting that it is hard to find staff with the right qualifications. Further research conducted by Manpower indicates that 21% of UK employers are faced with skill shortages. Detsiny believes the recent enlargement of the EU could provide a wider labour pool for UK employers, which could contribute towards tackling the skills gap:

Contrary to much speculation, the recent expansion of the EU hasn’t yet resulted in a flood of migrant labour. However, there is an opportunity for employers to tap into new pools of labour from new member states. Our research also shows that one in five employers would consider employing someone from the accession states to help fill this need. In the short-term, however, lack of skills in many sectors is likely to persist.

Across the UK, eight of the nine industry sectors surveyed by Manpower are
planning to take on staff next quarter. Employers in the Transport and
Communications; Finance and Business Services; Construction; and Manufacturing sectors all reported figures above the national average. However, the Hotel and Retail sector - often seen as a good indicator of consumer confidence - has declined by six percentage points over the last quarter to 10%.

Employers in eleven of the twelve regions surveyed intend to take on more staff for the quarter ahead. Employers in East Anglia are the most optimistic. Conversely, employers in the West Midlands and the North West are the least optimistic: both regions reported year-on-year and quarter-on-quarter declines.

Of the 11 European countries surveyed, as in quarter two, all except Germany (-4%) reported positive hiring intentions. The strongest outlooks in Europe are reported in Ireland ( 18%), Sweden ( 16%), Spain ( 14%), and the UK ( 14%).

Looking at the results from a global level, 18 of the 19 countries surveyed by Manpower anticipate positive Net Employment Outlooks for the three months ahead. New Zealand ( 30%) and Canada ( 25%) report the most buoyant forecasts. Employers in 16 of the 19 countries expect more hiring compared to this time last year.