While employers’ confidence in the UK economy remains low, they are still looking to hire, according to the Recruitment and Employment Confederation’s latest JobsOutlook report.

The JobsOutlook report shows that confidence levels are at net: -26, a fall of 1% from the previous rolling quarter.

However, despite the lower confidence levels in the economy, employers are still looking to hire. Forecast demand for permanent staff increased to net +19 in the short-term and net +21 in the medium-term in May-July 2019, compared to the net +16 and net +18 recorded in the previous quarter (February-April 2019).

Short-term forecast demand for temporary agency workers also increased from net +2 in February-April 2019 to net +5 this quarter (May-July). Demand was much higher among SMEs than large organisations.

Meanwhile, the proportion of employers of temporary workers transferring at least half of them into permanent posts each year increased from 15% in May-July 2018 to 23% in the same time period this year.

However, nearly half, or 46%, of employers of permanent staff expressed concern about finding enough suitable candidates for hire, with Health & Social Care skills being the area they were most concerned about being able to access.

The report showed that 77% of employers highlighted that they have little or no surplus capacity in their workforce this quarter. That includes 45% of public sector employers who reported having no spare capacity at all.

Tom Hadley, Director of Policy and Campaigns at the REC, commented, “Our flexible labour market continues to be one of the strongest elements of the UK economy. This most recent survey shows employers are still looking to take on both permanent and temporary workers as they seek to maintain stability amidst the Brexit uncertainty. More employers also seem to be trying to transfer their best temps into permanent roles as candidate shortages continue to bite across many sectors.

“These skills shortages are especially acute in sectors like health and social care,” Hadley said. “With over 100,000 vacancies in the NHS and staff already working at full capacity, the government’s recent announcement on ending freedom of movement has come at the worst possible time. EU workers are an integral part of our health and social care system and the UK workforce as a whole. It is essential that the government has in place a sensible transition towards an evidence-based immigration policy to help reassure employers and EU citizens.”