Ninety-five per cent of UK businesses must hire if demand increases

Four in ten employers (39 per cent) have ‘no capacity’ to take on more work without more staff, and a further 56 per cent have only ‘a little’ capacity, according to the latest JobsOutlook survey by the Recruitment and Employment Confederation (REC).

The latest data shows another month-on-month increase in the number of employers saying they need to take on more staff to meet growing demand. Since August 2014, the proportion of employers with limited or no capacity has increased by 5 percentage points (from 90 to 95 per cent), and in the same period the number of employers reporting ‘a fair amount’ of spare capacity has halved from 10 per cent in August 2014, to just 5 per cent in February 2015.

This month’s survey also found that almost eight out of ten employers (79 per cent) plan to hire more permanent staff in the next three months. A further 13 per cent intend to maintain current staffing numbers and only 8 per cent indicate they will reduce their headcount.

Twenty-four per cent of employers highlighted an anticipated shortage of temporary workers with technical and engineering skills (19 per cent share that worry for permanent workers).

REC chief executive Kevin Green said:

“We heard a lot in last week’s Budget that confirms what employers are saying to us; that confidence is returning to the market and that businesses are seeking to take advantage of increasing demand. The government also announced new investment in infrastructure and transport initiatives, which is a further sign of the strengthening economy.

“Questions remain however about where employers will find the skilled workers to carry out these projects, and to respond to growth. Employers are already reporting talent shortages in key industries like engineering, IT and construction. Fixing this needs to be a priority for the next government so that the UK can continue to prosper. That means a sensible approach to immigration so that businesses have access to the talent they need today, while the government improves careers advice in schools and encourages more young people to study the right subjects.

“Recruiters also have a major part to play in connecting employers to untapped talent pools, such as the 1 million older workers who are not currently employed, and who could provide the skills and experience that employers are looking for.”