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UK employers plan to expand permanent and contractor headcount

UK employers plan to expand permanent and contractor headcount

September 30, 2024

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UK employers are planning to increase headcount in the next six months. However, growing skills gaps combined with increased worker confidence are set to impact these hiring plans, according to research from Robert Half.

The research showed that over a third (39%) of employers are planning to expand permanent resources, and almost a quarter (24%) intend to hire more contractors in the next six months. On average, 77% are planning to expand or maintain business-critical permanent, contract and project-based roles in the next six months.

According to the study, the top functional areas with the highest levels of planned recruitment are customer service, AI/automation/machine learning, administration and compliance / regulatory / governance.

Robert Half said this latest data will be a boost to the fortunes of UK employees and job seekers. However, this will only further underpin job confidence that has been rising across the UK.

Meanwhile, the Robert Half Jobs Confidence Index (JCI), produced in conjunction with the Centre for economics and business research (Cebr), shows that job confidence in the UK has seen a steady increase throughout 2024.

The JCI increased to 51.6 in the latest iteration of the report, marking the fifteenth consecutive quarter that it remained in positive territory. For context, a score between -30 and 30 is considered average rates of confidence.

This boost was largely driven by improvements in pay and job security confidence, with the latter standing at 152.1, the second-highest reading recorded for this pillar since records began in 2009. As a result of rising job confidence, Robert Half predicts that ambitious workers may be ready to move for the right packages and opportunities.

Chris Lawton, Vice President of Permanent Placements UK & Ireland at Robert Half, said in a press release, “The fact that we are seeing firms planning to increase their headcount in the next six months is promising. In finance and accounting, for example, our latest research shows that 95% of companies plan to make permanent hires and 83% on a project-management basis in the next six months. While this is clearly good news for job seekers, employers could still be in for a turbulent time due to ongoing challenges attracting and retaining talent amidst widespread skills shortages and rising worker confidence.”

Lawton continued, “As worker confidence continues to show no signs of abating, employees clearly hold the power. With higher salaries an unsustainable option for most firms given low consumer demand and more choice for candidates on the cards, businesses are going to have to work harder if they are to attract the people they intend to hire over the next six months and beyond. That will mean developing more robust employment packages that encompass everything from culture and DEI, flexible working practices to tailored perks and benefits that make a difference to the employer proposition.”