Economic Update July 2023

​Castle Employment Group provides an overview of the key insights from the recent economic and recruitment market update:

1. Economic Outlook and Recruitment Activity:

Lingering uncertainty surrounding the economic outlook continues to impact hiring decisions, leading to a fall in permanent placements and mild growth in temporary placements. Additionally, vacancies have expanded at the slowest pace in 28 months as companies remain hesitant to hire additional staff due to the prevailing economic uncertainties.

2. Candidate Supply and Pay Pressures:

The slowdown in recruitment activity and reports of redundancies have resulted in a sharp rise in candidate availability. Both permanent and temporary worker supply have increased at the highest rates since December 2020. Moreover, pay pressures have moderated, with rates of starting salary and temporary wage inflation softening to their weakest levels in over two years.

“We have seen a definite increase in candidate activity over the last month compared to the start of the year. Candidates seem to be more engaged and active in new job searches. Jordana Renshaw Director – Business support 

3. Regional and Sector Variations:

Permanent placements have declined in most English regions, except for the North of England, where an upturn has been observed. London has experienced the most significant increase in temporary billings, while the North has seen a decline. Demand for workers has risen in both the private and public sectors, with the strongest growth seen in permanent public sector staff. Sectors such as Hotel & Catering and Blue Collar have witnessed the highest increase in demand, while IT & Computing and Retail sectors have experienced a decline in job openings.

The economic uncertainty impacts hiring decisions leading to a slowdown in recruitment activity. However, there has been a notable increase in candidate supply, which has helped ease pay pressures. Regional and sector variations are evident, with some areas experiencing stronger demand for workers compared to others.

The economic update also highlights the significance of AI and automation in addressing labour supply shortages, as well as the challenges posed by inflation and a lack of productive capacity. The outlook for inflation, growth, and employment remains uncertain, and the impact of AI and automation on various sectors will play a crucial role in shaping the future economy.

At Castle Employment Group, we understand the challenges and uncertainties brought about by the current economic situation. That's why we are committed to providing our clients with the guidance and support they need to navigate these complex times successfully.

Our team of experts closely monitors the economic outlook and recruitment market updates, providing you with key insights and analysis. We can help you understand the implications of the current trends on your recruitment strategies and offer tailored solutions to address your specific needs.

Whether you are seeking advice on managing candidate supply, adapting your pay structures, or navigating regional and sector variations, our knowledgeable consultants are here to assist you. We have a deep understanding of the local market dynamics and can offer valuable guidance to help you make informed decisions.

Contact Castle Employment Group today for further advice and guidance. 01723 365432  info@castle-employment.co.uk