New research shows the amount of time it is taking businesses to hire employees has fallen to its lowest level in seven years, in a sign friction in the jobs market.
Employers left advertised roles on job boards for an average of 37 days last year, down from 44 days last year, according to job search engine Adzuna, which surveyed more than 80 million applicants as part of the research. UK ads monitored.
Vacancy lead times are monitored by investors, economists and central bankers for signs of labor market tightness, which indicate whether demand for workers is being met by supply.
Over the past year, a reduction in the size of the workforce due to an increase in the student population and an increase in long-term illness has hampered companies’ hiring efforts.
Staff demand remains high despite the UK economic downturn and twelve consecutive Bank of England interest rate hikes to an almost 15-year high of 4.5 per cent. According to the Office for National Statistics (ONS), there are 1.2 unemployed per vacancy, which is historically very low.
Unemployment rose to 3.9 percent in the previous quarter, although this was mainly driven by a record net outflow of 241,000 from economic inactivity during the period. People who are not in a job or looking for one are not counted in the ONS’s unemployment figures.
A strong appetite for workers coupled with a weak labor supply has given companies an incentive to raise wages to attract workers. Private sector salary hikes have picked up faster than last year.
Bank economists have identified cooling wage growth as convincing measures to hold off on raising interest rates at their next meeting on June 22. The market expects borrowing cost to rise at least once more this year.
A reduction in the economically inactive population should reduce stress in hiring processes by providing businesses with more candidates.
Andrew Hunter, cofounder of job search engine Adjuna, said: “The jobs market is back in favor of employers, but many businesses are still struggling to fill talent gaps.”
The company found that it is taking just over 108 days to acquire automotive technicians and 101 days to hire a nurse, the top two roles with the highest vacancy lead times. Adjuna said it takes 100 days to hire an IT consultant.
Barriers to finding suitable employees are “driven by skills shortages and ongoing workers’ strikes, with the most difficult-to-fill roles demanding specialist skills and occurring within the automotive, health care and sales sectors,” Hunter said.