I write this blog post off the back of our second-best financial year at Red Tiger Talent but off the back of our worst first quarter in 3 years. Recruitment markets are so hard to predict, there is no definitive cycles, but my gut feel is that a lot of the market (like many markets) is linked heavily to general mood, optimism, and the economy. We have seen so many times at Red Tiger Talent (especially after COVID lockdowns) once confidence starts to come back into the nation, recruitment starts to pick up.
Don’t get me wrong, there are roles we are currently working on (we don’t need lots of roles to keep us busy given the depth of the searches that we do) but not at the levels we would ideally like to see. This blog post will be of interest if you are thinking of or trying to recruit as it is giving my thoughts and predictions on the market and some general advice for managers.
Not an Abundance of Decent Candidates to Recruit
This is a keynote for most hiring managers (although if you have an attractive role there will be obviously more of a pool) as you need to think about how you can widen your net to try and capture as many candidates as you can. I always think from a recruiting perspective that in an ideal world we would find 10 people that are interested and could do the role and then we would put forward a top 4.
Of course, it rarely works like this, but this is the level we aspire to at Red Tiger Talent so do bare us in mind if you are looking to recruit in our core areas of Location Planning, GIS, Consumer Insight, Property Research and Economic Development Consulting.
Not an Abundance of Decent Jobs on the Market
This goes hand in hand with the section above, in fact all these sections are linked in some way. Steve’s latest post Supply Outstrips Demand goes into more detail on the lack of appropriate opportunities currently available for experienced candidates looking for a new challenge.
We do have one great role at the minute and given our experience and knowledge in the markets we operate in we just know that it will have an abundance of applicants. The following sections explore some of the reasons why the market is a little slow at the minute.
Political climate
You can’t escape the constant negative news we are inundated with from the climate to wars to potential issues of new strains of covid. This negativity feeds the lack of decent candidates and decent jobs as people’s outlooks become less positive so therefore it is human nature to be more conservative. This means firms will not look to take the risk to expand and candidates will not take the risk (unless the reward is big) to move roles.
Cost of living
This has been a large influence, and I am no expert (merely a B at A-level Economics) but there are many levers in the economy that add to the lack of optimism at the minute.
Inflation
The Consumer Price Index (CPI) is the main measure of inflation and is what is used for the Bank of England’s target of 2% inflation. This peaked in October 2022 at 9.6% and the latest figure of September 2023 shows it at 6.3% so it is on the right trajectory. The economy can be both simple and complex at the same time but my main views on the drivers of inflation are as follows:
- Post-covid demand: Confidence and mindset change through the lockdown experience had driven a demand for luxury goods and experiences.
- Brexit: This has caused a negative supply shock – so when you reduce supply, the price goes up.
- Energy and petrol costs: This is a big one and again linked to post covid and the war in Ukraine. This then has a knock-on effect on prices for goods and services as companies’ costs go up and are passed on to customers.
Interest rates
If we thought that the cost of living (especially energy price and food price surges) was bad enough we have then been hit by an increase in interest rates to reduce demand and then to hopefully start to trigger a reduction in inflation. This is now showing to be working and it is a fine balancing act as if you get it slightly wrong it could plunge the UK into a recession by reducing demand too much.
The current base rate of interest is now at 5.25% (the last time it hit this height was February 2008) and they have remained that way for a second successive month after 14 successive monthly increases. This, along with inflation going in the right direction, I believe is good news as now it shows some stability in the economy which should start to build some optimism. As I write this there is also now very recent talk of interest rates potentially coming down in 2024. It is interesting that there will also be a General Election in 2024.
In conclusion, putting my neck on the line here I do expect the current low levels of roles and low levels of active candidates to remain the similar until early 2024 followed by some green shoot of recovery as we move through 2024. As mentioned, numerous times it is all about stability and confidence and after a shaky 14 months (wars and global unrest aside) things are starting to look a lot more positive!
If you have a recruitment requirement, or are looking for your next role, get in touch with us today to discuss your needs further and see how we can help.
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