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Q3 Recruitment Trends in the Industrial, Engineering, and Office Sectors.

As the UK pushes into what could confidently be called a “post-pandemic” environment, domestic industry is finally poised to start looking once again more long term, especially as vaccine uptake rates rise, confidence builds and international travel becomes simpler.

 

UK GDP grew 4.8% in Q2, powered mostly by increases in “wholesale and retail trade, accommodation and food service activities, and education” (source). Growth is expected to continue into Q3, hitting 3.5% before falling in Q4 (source), however the country is very much on the path to growth, despite GDP still being approx 4% lower than pre-pandemic levels.

 

But, there is a lingering issue about the long term “scarring” of younger workers’ opportunities due to COVID-19.

 

Many young people entering the workforce are finding opportunities in some sectors (especially in many traditional “first job” sectors and, bearing in mind, more and more people are entering the workforce in lower paying jobs) either unappealing, unavailable or unsupported.

 

How this manifests in the coming months and years is yet to be seen, but predictions are worrisome – higher rates of unemployment, poor workplace mental health, a generation of workers both pushing for and expecting faster wage growth and career support upwards from lower paid jobs, is pushing pressure upwards onto employers.

 

Q3 Overview

 

July 2021

 

  • Payrolled employees rose in July 2021, with notable employment improvements exceeding predictions in some areas, even rising above pre-pandemic hiring levels in the North East, North West, East Midlands and Northern Ireland (source), but the highlight of the month was the final loosening of COVID restrictions (source).

 

  • The national redundancy rate dropped back down to pre-pandemic levels, thereby closing the book on one of the most negative and damaging of COVID-19 impacts on the UK workforce.

 

  • As of 31st July 2021, 1.6 million staff were still on furlough (source).

 

August 2021

 

  • There was an unexpected fall in retail sales in August, however some of the drop from retail food sales was made up in hospitality spending. Other sectors – such as petrol/motor travel – increased as more people ventured out, with staycations continuing to fuel growth, and online retail rose slightly month on month compared with July (source).

 

  • As of 31st August, 700,000 full time workers were still on furlough and reports have stated that in the three months leading to the end of August, job vacancies rose above 1 million for the first time since records began (source), with ongoing and seemingly growing hiring issues in major industries such as hospitality, logistics and tourism.

 

September 2021

 

  • The true impact of COVID-19 will be felt when the furlough scheme ends on September 30th, and predictions are that this loss of support, alongside the removal of the extra funds attributed to Universal Credit, will impact poorer people, BAME employees, the disabled and women the most.

 

  • The implications are particularly damaging for industries who are emerging from the worst of the pandemic later than others, ones that rely overwhelmingly on more flexible, lower “skilled”, or younger workers.

 

The Industrial & Manufacturing Industries

 

  • Ongoing supply chain issues as a result of pandemic related issues and Brexit continue to plague the global manufacturing sector, and purchasing and selling of domestically made products here in the UK, with worker shortages representing the biggest barrier to growth.

 

  • “The worst shortages of components and raw materials since at least 1977 have befallen Britain’s manufacturing sector, hitting factory production and holding back its economic recovery from lockdown” with specific shortages in microchips having a significant impact on a variety of manufacturing sectors such as cars, microwaves and mobile phones (source).

 

The Trades & Engineering Industries

 

  • “More than half of engineering design firms – mostly based in the UK – polled in August 2021 by The Engineering Design Show claim they are finding it difficult to recruit and/or retain staff with the right skills” (source). As with many other specialist industries, the Engineering sector is struggling to hire the right talent to meet demand, with IR35, Brexit and an “image” of engineering as an unappealing career path polled as significant reasons for not entering the engineering workforce.

 

  • However, there are some positive industry movements to look forward to, such as: the Government strategy for high Gross Value Add (GVA) industries, which will improve funding to engineering; the high value of apprenticeships as secure paths to career growth; and the growing emphasis and importance of tech in our daily lives.

 

The Office Services Industry

 

  • While traditional office service industries such as the legal sector and retail fell, surprisingly, in July and August, the post-pandemic pendulum swung in favour of the arts, hospitality and travel, surging by 9% due to the loosening of COVID restrictions at the end of July (source).
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