The latest UK REC/ KPMG Jobs Report shows that demand for workers grew rapidly in March as businesses implemented recovery plans. Temporary billings also grew at the fastest rate since 2017, reflecting the need for contingent workers as the market picks up.
Neil Carberry, chief executive of the REC, said: “For months, we have been talking about the potential recruiters saw for a recovery in hiring as we got on with vaccinations and the lockdown did its work. Today’s data shows that even during lockdown, our labour market was bouncing back.”
While the start of April saw the introduction of the controversial IR35 rules, it’s expected that the increase in hiring will offset the impact. With the impact of Covid and Brexit creating uncertainty for businesses, contractors offer crucial on-demand skills for the completion of bounce back projects.
As the recruitment market is starting to rebound, businesses are identifying major skills gaps. In particular, demand for IT contractors rocketed in March as businesses prepared to forge ahead. There was also a marked shortage of construction workers this quarter, with demand remaining high in the sector.
Other sectors to identify skills shortages were Digital Marketing, Medical, Finance and Tourism & Leisure. The only sector to note lower demand was Retail, which was down for both temporary and permanent vacancies. This can be attributed to continued pandemic restrictions and the shift towards online trading.
The REC/KPMG survey also showed the first decline in the availability of temporary workers since February 2020. Though only slight, the pandemic, Brexit and changes to IR35 legislation have contributed to the reduction in candidate numbers.
Pay rates for temporary jobs – which includes contractors and umbrella workers – also increased for the first time in three months. Competition for contractors in many areas is likely to keep rates competitive for the foreseeable future.
Blue Collar hiring showed the most marked uplift for contingent staff during March, with the Midlands recording the strongest increase in temporary billings of all four regions. Vacancy growth was also more pronounced in the private sector, where demand for short term positions hit its highest since September 2018.
The number of jobs advertised as remote working has quadrupled in the last year. As lockdown restrictions ease, some businesses will inevitably welcome people back to the office. However, the pandemic has shown that a remote workforce can be both productive and cost-effective.
There’s also a greater overall demand for flexible work patterns and contracts that don’t follow the standard 9-5 pattern – a style of working that’s natural for many contractors. As businesses adapt their systems for remote and flexible working, this could result in wider use of contractors and greater range of contract types.
Amaze Umbrella’s service gives you a fully compliant IR35 solution. Our service also offers benefits of employment that permanent staff receive as well as Perkbox* benefits, insurance cover and a seamless onboarding experience from our first-class customer service team. To speak to a member of the Amaze team see here or for information on the sectors to watch in 2021 see here.
*Perkbox services are available to contractors paying the qualifying service fee. Please contact us for information.