Executive Summary and Contents
Salary pressures and a persistent talent shortage continue to challenge UK businesses, leaving them struggling to recruit the workers they require.
Source: MEOS Q3 2023.
The UK’s rising cost-of-living and high inflation impact everyone, but businesses must face these challenges as well as an acute talent shortage that is impacting productivity and profitability, which in turn increases costs and pricing. Unfortunately, even as recruitment in some sectors is currently softening, demand for experienced business administrators and managers, accountants and finance workers, and contact centre and customer support personnel continues to outstrip supply. These are the linchpin roles that keep the UK businesses running providing the essential links between producers and customers, managing business finances, keeping supply lines open, production running, and workers in their jobs.
The traditional response to any shortage, be it for a commodity or for skilled workers, is for prices to rise to match supply. The 2023 Business Salary Guide shows evidence of this happening now, as businesses in these key industries remain unable or unwilling to meet employee salary expectations, workers are reluctant to pursue vacancies because of the general uncertainty of the economy, and hiring remains difficult across all of the UK.
The net effect of this is businesses either needing to increase pay offers regardless of whether they can afford them or not, or, where there is great urgency to hire, or business owners are wary of increasing their payroll amid the UK’s economic uncertainty, organisations are turning to short-term temporary workers at higher cost (some temporary accounting and finance salaries are 50% higher than the compensation being offered to permanent employees for doing the same job).
However, those businesses hoping for a swift and improved adjustment in the ratio of worker supply to job vacancies are set to be disappointed. With more than 1,000,000 vacancies remaining persistently unfilled across the UK, over half a million workers out of the workforce due to sickness, and a further 8.64 million of the adult population classed as ‘economically inactive’, it is unlikely that there will be surplus of skilled workers anytime soon.
Source: Indeed.com
Summary: Talent shortages and correspondingly elevated compensation levels are here to stay – at least for a while. Businesses must use creativity and adaptability to overcome these barriers to hiring - see a variety of strategies and tactics to achieve this in the pages that follow.
Why businesses need information on hiring trends and salary rates
Information supports informed decisionsKey discoveries in this document
Hiring and compensation problems are putting added strain on businesses
Productivity and profitability at riskDespite high hiring intentions, talent shortages are hurting UK businesses
Salary and hiring perspectives across the sector
The South East impactOutside of the Southeast, candidate supply is thinly spread
The national pictureUK statistics
The macro-regional pictureRegional statistics
The city pictureCity statistics
Multiple factors impact recruitment and retentionPay is important, but it’s not the only problem
Rise of the contract workerBusinesses buying their way out of a hiring problem
Working with an experienced advisor is key
About Brook StreetMeeting the challenges is a task best shared
Client testimonialsHear what Brook Street clients have to say
Contact Brook StreetContact information
