More businesses look to contractors as confidence levels fall

With the pandemic causing such uncertainty, permanent hiring is stalling and so more UK firms are looking to temporary staff for additional support.

The Recruitment and Employment Confederation’s (REC) latest JobsOutlook report also found that employers’ confidence in their ability to make hiring and investment decisions fell by five percentage points from the previous rolling quarter.

Employers’ intentions to hire permanent staff had been improving during recent months, however, a fall in confidence has caused it to stall, with an increasing proportion of firms looking to temporary workers for support.

Short-term demand for agency workers rose by three percentage points from the previous rolling quarter to net zero, while medium-term demand rose by seven points to net: +4.

Neil Carberry, Chief Executive of the REC, said, “The autumn proved challenging for many businesses as the pandemic took a turn for the worse, something that is reflected in today’s figures. Once again employers are looking to temporary workers to help them through – and Britain’s flexible labour market is doing exactly what it needs to, supporting firms, workers and the economy.

“[Today] the Chancellor has a chance to boost both business and consumer confidence in the Spending Review, and we’ll be looking for a number of measures in his speech today – including a cut to employers’ National Insurance, which would help incentivise job creation as well as minimising further redundancies. Other measures which would maintain and enhance the ability of our jobs market to bounce back would be funding support for limited company directors – who have been forgotten so far – and steps to fund Statutory Sick Pay for all.

“SSP support would reduce the risk of hiring temporary workers and encourage more placements to be created. Broadening the apprenticeship levy would help people get the training they need to stay employed and find new work during this difficult winter.”

To find out more about contracting please contact Jessica on 01206 591 000 or email jessica.attwood@contractorumbrella.com.