With latest data showing that vacancies are at a record high, the CIPD warns that the Omicron variant could challenge future economic recovery.
The ONS figures show that unemployment remains low with employers having to fight harder for every candidate, mostly using pay rises to both attract and retain people.
However, the CIPD highlights that this data is taken from before the new Covid-19 variant was discovered and therefore any changes in consumer behaviour won’t have been registered.
Jonathan Boys, labour market economist for the CIPD, explained, “The labour market looks much like it did pre-pandemic era, that is tight. This is feeding into wage growth – average regular pay growth is strong at 4.3%. We can be more confident about this figure than in previous months when pandemic effects skewed the annual changes. CIPD research shows raising wages is employers’ top response to hard-to-fill vacancies. Not all employers have scope to raise pay and so recruitment and retention challenges are biting.”
Boys added, “There are plenty of tactics beside pay rises that employers can use to attract and retain people. Against this backdrop of a job seeker friendly labour market, it is important that more employers take steps to advertise jobs as flexible so they can attract older workers, people with caring responsibilities or those with long-term health conditions who are willing and able to work.”
“The spectre of omicron looms over any statement we make about these stats, reminding us that the pandemic is not over. In recent months we have seen unambiguous recovery, but that could slow down or even reverse if restrictions and behaviour change place limits on economic activity. This is a particular worry for consumer-facing sectors like hospitality. Today the sector is registering a record number of vacancies, but the busy and much anticipated Christmas period will likely take a hit this year.”
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