2013 is nearly at an end and with the jobs market picking up as the economy strengthens, the groundwork has certainly been laid for a strong 2014.
The Recruitment and Employment Confederation’s (REC) Recruitment Industry Trends survey showed that the sector is resilient and has been able to work harder in difficult times to give clients the services they want, at the right price.
The market has certainly matured too and we’ve seen large and medium-sized businesses look to consolidation, acquiring smaller operators in the process.
To survive, smaller agencies have been forced to carve out niches. However, this has made for an interesting and vibrant market.
But what does this mean for the coming year and how have the ebbs and flows of the market in 2013 set the wheels in motion for the next 12 months?
Growth
The Recruitment Industry Trends Survey predicts that growth will continue over the coming years.
In 2012/13, market value stood at £26.5 billion – a feat achieved through a 12 per cent increase in permanent recruitment volumes and a two per cent increase in temporary and contract staffing volumes.
Between 2013/2014, expansion is expected to hit 7.3 per cent, rising to 8.3 per cent in 2014/15 and 9.6 per cent in 2015/2016.
Following this growth trajectory, the UK recruitment industry should surpass the pre-recession peak of £27 billion, with £28.5 billion turnover by the end of March 2014.
Contract workers still in demand
There are currently 1.1 million agency workers in temporary roles across the UK, accounting for around four per cent of the total workforce. On average, each consultant working in temporary and contract staffing is now sending out 32 people on assignment on any given day.
With a shortage of candidates with appropriate levels of skills and experience still causing concern, contractors and freelancers are stepping into the breach.
A lack of skills is most frequently reported by agencies working in permanent recruitment, with 25 per cent of recruiters citing this as an issue.
Fees
While a shortage of candidates and full workloads drives up rates for contractors, narrowing fee percentages have been cited by agencies supplying temporary staff. Indeed, 17 per cent have listed this as a concern.
Good or bad?
The latest Recruitment and Employment Confederation (REC) and KPMG Report on Jobs suggests that trends for 2014 will be largely positive.
Contractor availability fell at the sharpest rate in nine years in November and work is in abundance for freelancers.
This is largely driving up fees and contract rates are rising at a ‘solid pace that was sharper than in October’, according to the report.
With salary growth at a six year high and skills and talent shortages taking hold in most industries, all signs point to salary increases and improved job fluidity in 2014.
This bodes well for contractors, especially when we factor in the fact that organisations across the UK are maintaining their recruitment drives to cope with rising demand levels. People need only look at the fact that the growth in vacancies has reached a 15-year high to see the pace is picking up in recruitment.
How Brookson can help…
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I am a chartered tax advisor with a specialism in the freelance contractor sector advising contractors on how to structure their affairs and recruitment businesses and end hirers on the effective…
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