It’s hard to believe that a year ago the UK was embroiled in the first national lockdown of its kind as the Covid-19 pandemic first took hold. Twelve months on and we are all much better acclimatized to the “new normal.” And with signs that the UK economy is on track to end this year in a better position than we hoped — with analysts suggesting that the UK will see 4% economic growth by the end of 2021 — things are certainly looking up.
Positive Signs
The general optimism that we’re seeing across much of the UK is reflected in the staffing sector, which is an encouraging sign given that it often acts as a barometer for future economic trends. In fact, in our latest Recruitment Trends Snapshot, we saw a big spike in white collar hiring between November 2020 and February 2021.
While the data, provided by growth analytics platform cube19, revealed that hiring for both contract and permanent jobs was down 3% and 7%, respectively, in February from January, if we take a wider look at the statistics, the market is improving.
It’s common for February’s recruitment activity to dip following a flurry of activity in January. If we compare February’s data with November instead — eliminating the months where seasonal fluctuations are expected — vacancies have increased 24.6% and 14.6% for contract and permanent respectively.
The annual percentage drop also appears to be improving as the country battles back from the impact of the pandemic. While permanent vacancies were down 27% year-over-year in February, this marks a slight improvement from January where the yearly comparison stood at -28%. Contract vacancies are also showing promising signs, with just an 8% fall when compared with the pre-pandemic figures from February 2020.
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Recruitment Improving
What’s more important for recruitment businesses is that these statistics show promising signs from a revenue point of view. Permanent placement sales have spiked — up 24% month-over-month in February — marking the first return to pre-Covid sales levels since the pandemic began. There was also a 3% rise in contract sales despite placements falling by 4%, suggesting that there was an increase in higher-value placements.
With the Chancellor’s Budget announcement at the beginning of March, we expect to see this positivity continue, as some business security remains in place for the foreseeable future at least. Looking at the daily tacking data from cube19, we can also see further glimmers of hope. The statistics show that interview numbers increased slightly in the last week of February when compared to the first, suggesting that this uptick will translate into positive placement numbers — and ultimately promising sales revenue — in March.
Maintaining Resilience
Looking to the future, though, staffing companies are still facing a number of challenges. Cashflow remains a big concern for businesses that have faced a continued period of below-average sales, and careful cashflow control will need to be maintained as uncertainty remains.
And as the vaccination program continues to be rolled out, many recruiters are naturally looking forward to a return to the workplace. For staffing businesses, knowing when is the right time to get consultants back together and how to manage this will be a driver of success. We can’t forget that the last year has put immense strain on our staff, and we need to support their mental health in both a remote environment and during the transition back into the workplace.
We still have some way to go yet, but recovery for the recruitment sector is certainly underway, and the APSCo team will continue supporting staffing companies out of the pandemic and into a more promising future.