Salaries begin to show signs of improvement after recent lull

• Vacancies cooling after recent progress – as employers pause for breath before January recruitment drives
• Wage growth resumes after recent stagnation – but progress remains slow
• London salaries show the biggest regional decline over 12 months (-3.9%) – proof of the country becoming less capital-centric
• FinTech high on the agenda for the jobs market post-Brexit – typical salary of £38,182 and 12,438 current vacancies in burgeoning sector

The total number of advertised vacancies fell by 4.8% to 1,109,511 in December – ending three months of growth – according to the latest UK Job Market Report from Adzuna.co.uk.

Advertised average salaries rose 0.3% to £32,323, a brief respite after a tight squeeze on salaries during the festive period. This increase is a positive step in the right direction following the recent period of decline. However, year-on-year, salaries remain 3.1% lower than January 2016 to currently stand at £33,323.

According to the latest figures from the ONS, average weekly earnings for employees in nominal terms increased by 2.8% in comparison to a year earlier. Partly driven by low unemployment figures, employees and jobseekers can start to demand attractive pay packages with the confidence that other vacancies in the jobs market may suit their needs if their current roles don’t.

However, despite average advertised salaries beginning to rise, the number of opportunities for jobseekers and employees has gone in the opposite direction. Vacancies reached their lowest point since January 2016, according to Adzuna data. 

Companies such as Aldi have helped contribute to the recent increase in of wage growth and in turn has become the UK’s highest-paying supermarket. Aldi aims to give more than 3,000 employees a pay rise, earning £8.53 per hour and £9.75 per hour for those who live in London. As these figures are higher than the National Living Wage, Aldi has set the bar high within the jobs market, signalling that employees deserve to be compensated for their skills and hard work.

Table 1: Total advertised vacancies and UK salary

Doug Monro, co-founder of Adzuna, explains: “The jobs market has calmed following the hectic festive period. Despite total advertised vacancies falling slightly as companies pause for breath before renewed recruitment pushes in January, salaries have finally begun to trend upwards. Although it may be slightly too early to celebrate the increase, it is a solid indication that the market is adapting and continuing to evolve.

“With fewer vacancies and higher salaries, jobseekers may have to be slightly more selective when choosing their next step as the amount of choice jobseekers face in the market seems to be more restricted as competition per vacancy has increased.

“However, the overall confidence of the jobs market has been restored given that ONS figures continue to highlight that the unemployment rate remains low at 4.8%. Jobseekers are in a comfortable position as employers continue to invest into their talent pool.”  

Streets of London no longer paved with gold?

London continues to be the region with the highest number of advertised vacancies (248,605) and the highest average salaries (£38,449), but its previously unassailable supremacy may soon be challenged. Average salaries in the capital have fallen more (-3.9%) than any other region in the UK in the past year, suggesting jobseekers and employees in London may soon be facing a a disadvantage, as salary growth in the rest of the UK is catching up at a more consistent rate.

With competition for jobs per jobseeker per vacancy rising from 0.43 to 0.45 in January, this may suggest jobseekers in the capital may have two hurdles ahead in the shape of a more competitive job market and pedestrian salary growth.  

This also represents a wider shift in the jobs market as the Government creates a solid post-Brexit UK economy that drives growth across the whole country. It is likely growing trends such as companies relocating their headquarters to cities outside the capital such as Manchester will continue as well as reinvestments into northern powerhouses to revitalise former struggling areas and industries.   

Doug Monro, co-founder of Adzuna, concludes: “It is encouraging to see the UK adopting an approach of shared wealth across the country. Despite the salary decline in London, these figures show that as a whole, businesses are pushing for the jobs market in all regions to not only encourage, but contribute towards, the overall productivity of the UK equally.   

“This shift away from a capital-centric focus will open many doors and create multiple opportunities for other regions. In line with the Government’s recent announcement on a cash boost for the North of England to create jobs and invest in new sectors focusing on science, research and innovation, this collective approach is necessary for the UK to develop an effective post-Brexit strategy. If the UK jobs market is to operate in siloes, productivity will stagnate.

“In addition, the shift in the jobs market outside of the capital may also have been caused in part by the property market in London, as unattainable house prices coupled with stagnating salaries force consumers to relocating to increase their disposable incomes and stand a chance of getting on the property ladder.

 Table 2: Total advertised salaries and vacancies across the UK

Focus on FinTech

Bank of England Governor Mark Carney recently gave a speech heralding the FinTech revolution that promises to democratise financial services, cementing its transition from niche sector to one firmly on the radar of senior statesmen. Adzuna data shows that advertised salaries in the sector – dominated by the likes of crowdfunders, peer-to-peer lenders and currency exchange specialists – are typically around £38,182, comfortably above the national average.

With 12,438 FinTech vacancies available at present, there are plenty of opportunities for those seeking a career in the sector. Bitcoin-related jobs are some of the most lucrative within FinTech, with salaries averaging £64,036, 68% more than the FinTech average. This wave of innovation and technology has created a new field of technical specialism. Still in their relative infancy, both sectors are showing signs of shaking up the jobs market.  

Doug Monro, co-founder of Adzuna, explains: “The jobs market has been calling for technical innovation. Sectors such as FinTech and Bitcoin will aim to bridge the gap between the labour market and a post-Brexit economy. Once our EU exit negotiations are settled, these sectors will have level playing fields to not only advance the jobs market, but UK productivity as a whole.

“Not only does FinTech have the potential to expand the jobs market, but it could also potentially change our consumer habits. Innovations such as the collaboration between mobile technology and banking mean employers will have to think outside of the box in order to not only improve their business models and systems, but to attract the right talent into the industry.”