EMPLOYERS in Scotland are less optimistic than the rest of the UK about hiring new workers, new research reveals.
A ManpowerGroup survey found Scottish employers had an outlook of +4 per cent, down two points from the previous quarter and below the national average.
Jason Greaves, operations director at Manpower, said: “Hiring has been slower to pick up following the traditional dip in demand in Q1, but there are signs of employer confidence returning in the last month, and our Scottish companies are showing more optimism about the economy and their own business prospects.
“Interestingly, despite Brexit uncertainty, financial services and utilities companies have been the best performing over recent months.
“We are also encouraged that Nicola Sturgeon has revealed plans to create a national investment bank which is expected to create 150 jobs.
“Contact centre roles are also in demand, so these companies require a slick recruitment process.
“Suitable candidates rarely hang around for long, so employers need to be particularly responsive when they find the right candidate.”
Nationally, employers have recorded their highest level of jobs optimism in more than a year, with an Outlook of +6 per cent.
This unexpected increase comes amid sluggish macro-economic data and continuing uncertainty about how the UK will leave the EU. There are worrying signs that surface-level optimism is masking a more uncertain reality.
James Hick, managing director for ManpowerGroup Enterprise said: “This surprise jump in confidence could actually be a mirage.
“Take the best-performing sector, hospitality, which is up seven points to +16 per cent, a huge fourteen-point rise since this time last year. On the surface, this might look like a sector that is firing on all cylinders, but this is at odds with the almost daily diet of news about struggles in the sector, such as Jamie’s Italian and Byron Burger.
“Our view on the data is that it shows how desperate employers are to fill vacancies in an industry that is heavily dependent on immigration, with up to 24 per cent of all staff coming from the EU.
“Given that the sector employs around three million people, losing that proportion of the workforce would leave a shortfall of three-quarters of a million people.
“In recent weeks we’ve seen more reports that the number of EU workers arriving in the UK is falling – particularly those from eastern Europe – and employers are racing to make up the shortfall.
“The construction sector has experienced a huge drop in hiring confidence this quarter, with a six-point fall to just +1 per cent, down 12 points on this time last year. This chimes with recent PMI data showing a slowdown in all activity, even housebuilding, which saw its worst performance since July 2016.
“Despite political commitments around housing, the data raises questions around the future of policies such as Help to Buy. This uncertainty is causing developers to sit on their hands – a stance which may have been exacerbated by the recent house price falls in London.”
The Manpower Group Employment Outlook Survey is based on responses from 2102 UK employers.
It asks whether employers intend to hire additional workers or reduce the size of their workforce in the coming quarter.
It is used as a key economic statistic by both the Bank of England and the UK government.
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