Companies are increasingly struggling to fill existing roles. Finding workers is now a key challenge in many parts of the West, and experts are reporting that the problem is getting worse.
Research by the UK’s Recruitment & Employment Confederation (REC) published today has warned that a shortage of qualified candidates is contributing to a slowdown in staff appointments. And for businesses, this is translating to a growing wage bill.
“Across the majority of sectors, both temporary and permanent opportunities are growing, and a lack of candidates means it is no surprise to see starting pay also rising,” said Neil Carberry, REC chief executive.
It’s a similar story in the US, where the labour market is close to full employment. As a result, finding workers is becoming a growing challenge that is set to only increase in the future.
“Business’ number one problem is finding qualified workers. At the current pace of job growth, if sustained, this problem is set to get much worse,” said Mark Zandi, Moody’s Analytics chief economist.
“These labour shortages will only intensify across all industries and company sizes.”
Why is finding workers becoming such a challenge for businesses?
One of the key reasons that finding staff is proving so challenging is that many workers are concerned about economic uncertainty, making a job change risky.
The increasing levels of protectionism and mounting trade war are affecting many areas. However, Brexit is amplifying concerns in the UK.
“Recruiters report that some of this high vacancy rate may be driven by good demand from companies not being matched by candidate willingness to move in the face of the current economic uncertainty,” added Carberry.
Skills shortages are making finding workers harder
In some fields, a skills shortage is playing a significant role. Highly technical positions that have seen significant growth are particularly impacted by this, as levels of suitably educated candidates are not keeping up with demand.
Recent research by Studio Graphene and City RoadCommunications, for example, revealed that a third of London tech startup founders believe there is a shortage of skilled tech workers in the UK capital, with 30% saying their growth had been hampered by a lack of suitable talent.
Niche technology industries such as cybersecurity are particularly hard hit.
“There is a critical shortage of cyber professionals across the globe, which makes it difficult for organisations to find talented individuals and puts added pressures on existing cyber professionals to keep their skills sharp,” explained Andy Ozment, chief information security officer and head of tech risk at Goldman Sachs.