Shortage of UK Skills due to Immigration rules

December 22, 2014

All large economies face skills shortages in certain sectors from time to time. However, according to a recent report by the Recruitment and Employment Confederation, or REC, there were some significant shortages among the UK's workforce over the course of 2014, and things may become more acute in the New Year. The study said that the shortages of suitably skilled people were not just in sectors where they are often expected, such as IT and engineering, but there was also an increasing demand for skilled manual workers, like brick layers, too.

The report found that recruitment agencies continued to find more work for people during the month of November and that pay was steadily, if slowly, increasing during that period. This, the report claimed, was the case even though there were signs that the rate of growth the UK economy has enjoyed since the global economic downturn was starting to be arrested. If the economy of Great Britain is really beginning to slow down somewhat, but pay is modestly rising, the answer must be down to the supply and demand of skills in certain sectors of the economy. With much of the rest of Europe facing far mare difficult to manage economic woes, it may well be that the UK remains among the most popular places for migrants to consider working. Of course, the availability of work for skilled and professional people is just one factor of many, but it seems that the UK's relatively buoyant labour market continues to make it an attractive proposition.

“It has been a good year for the British labour market and it is a signal of continuing business confidence that many companies are choosing to expand their permanent workforces,” said Kevin Green REC's chief executive. “Furthermore, they are prepared to make more and more generous offers to potential employees in order to attract the right people,” he continued. Green went on to add that more than 25 per cent of the recruitment consultants that took part in the study reported that starting salaries for jobs at an equivalent level are going up by the month, often driven by sometimes intense competition between employers for the highest-calibre and most skilled candidates.

The Future For Skills in the UK

According to REC, the view into 2015 will see a growing intensification of the skills shortages that already span into many industry sectors across the UK. “Shortages are particularly acute in areas of high skill, such as engineering, medicine and information technology,” said Green. “It is not only about highly educated graduates, however,” he went on. “Vacancies for skilled manual jobs are becoming more difficult to fill as well.”

For example, there is currently already a dearth of licensed HGV drivers in the UK, according to the report. In addition, the shortage of forklift operators could mean that many of the country's retailers struggle to meet demands of the festive period, simply because their supply chain falls down because goods cannot be despatched quickly enough from warehouses. Increasingly, employers who have requirements in these skill areas are turning to oversea workers to fill the gap, sometimes permanently and sometimes as a mere stop-gap measure whilst other staff members are trained up to a suitable level.

In another survey recently conducted by the large UK-based recruitment company Manpower Group, the findings of REC were echoed. Their research suggested that unemployment in the UK will continue to go down - and may well do so at a rapid rate - over the course of the next couple of months. According to their study, British companies have hired many more staff over the course 2014 than most economists had previously expected. The government's own department which looks into these matters stated that hiring would probably slow in 2015 and that productivity would gradually pick up partly as a result. However, the Office for Budget Responsibility made much that same prediction last year, too, only for it to turn out not to be the case.

According to Manpower Group, firms in the utilities and construction sectors have the most optimistic hiring plans in the upcoming period. Migrants with the relevant skills might be interested to know that it is the northeast of England which has the brightest outlook in these sectors, not the southeast, which is traditionally seen as the powerhouse of the UK economy. “Next year will begin with employers in a more confident position,” said Mark Cahill, the managing director of Manpower Group. “Lots of big businesses accumulated cash reserves in the downturn, and now that confidence is coming back they have funds to invest in growing.”

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