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UK – Temporary employment outlook optimistic

19 September 2013

The total UK workforce grew to 29.84 million people between May and July 2013, up 80,000 from February to April 2013, and up 275,000 from a year earlier. The rise in the number of those employed increased 98,000 this quarter, and was wholly attributable to full-time offers of employment, according to the latest JobsOutlook from the Recruitment and Employment Confederation (REC).

The slight drop in the number of temporary workers, which fell by 37,000 to 1.56 million, and self-employed workers, which fell by 27,000 to 4.2 million, is a sign that working on a freelance of temporary basis can act as a stepping stone into permanent employment for those who seek it. 

The positive net balance registered in August between planned increased versus decreased usage of temporary staff in the next quarter (28%) continues to show a significant year-on-year improvement. This figure is up from 13% last year and 5% in August 2011. Added to this, 60% of employers plan no change to their current use of agency staff. The REC considers this a hugely positive showing for the planned use of agency workers in the next quarter.

The net balance of 26% of employers planning increased versus decreased usage of agency workers over the next year shows further upward year-on-year movement, compared with 10% in August 2012 and 8% in August 2011. Further evidence that agency labour is increasingly helping organisations meet their corporate objectives and strategy comes from the fact that 79% of employers now state this to be the case. 

As per last month, and in a similar vein to their sentiment over engaging more permanent employees, it is the microbusinesses (with 1-10 employees) who either still have sufficient capacity and/or are apprehensive about engaging more contingent workers. At the other end of the spectrum, large employers are showing a marked increase in their appetite for use of agency workers. The net balance of their intent to increase the number of agency workers in the next quarter moved to 39% in August, up from 27% just a month earlier.

Two out of the top three categories of anticipated skills shortages over the next year (driving/distribution and IT) are the same for agency labour as they are for permanent employees. The acute anticipated shortage in contingent driving and distribution workers further evidences the key strategic role that agency workers play in supporting the emergent growth in the manufacturing and retail sectors.

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