Mind the Skill Gap!
Hello and welcome back to the Recruitonomics Newsletter, coming to you a bit early this week due to the Thanksgiving Holiday! This week, we’re looking at the graduate skill premium in the United Kingdom and what that means for recruiters.?
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This Week on Recruitonomics:?
The UK Labor Market Does Not Reward Graduates?
The United Kingdom’s economy and labor market are suffering from various problems, from a dysfunctional housing market to lower productivity growth to a myriad of debt. On top of it all, the tightening cycle by the Bank of England is hurting the economy even further as surging interest rates impact the housing market and corporate sector. These problems are interrelated, and feed into another issue the U.K. labor market faces: The underutilization of the country’s college-educated workforce. Most regions in the U.K. have a high share of college graduates, but many of them are working in non-graduate jobs: the country is lacking high-skilled jobs. The greater London area, less so, but this area’s housing and rental markets have become so unaffordable that college grads cannot afford to live and work there. Other regions are not creating enough high-skilled jobs, so graduates end up in roles that do not necessarily require the skills they gained. The share of recent graduates in non-graduate jobs comfortably exceeds 40% in most regions in the U.K., a frightening degree of underutilization of skilled labor. There is a frightening mismatch between the supply of and demand for skilled workers in the regions outside London.
Read the full article here.
What does this mean for recruiters??
For employers, the implications should be quite clear: Large companies should increasingly start looking to recruit outside of Greater London. The supply of skilled workers is relatively high across all regions in the U.K. and many workers will actually end up having higher purchasing power in cities like Birmingham because of lower housing costs. With the U.K. being one of the advanced economies with the highest level of regional disparity, a greater emphasis on economic development outside the capital is desperately needed! It should be a win-win situation for both workers and employers.?
Recruiting Tips:?
It’s time: The 2024 Trends Report is here! This report highlights 15 trends that will shape the recruitment market in the coming year, straight from our experts here at Appcast. From labor market movements, to AI’s next frontier, to new budgetary constraints, we have brought together everything you need to consider before the new year begins. Download today!
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领英推荐
If forecasters have learned anything from the last two years, it should be that predicting recessions is a fool’s game. The first recession calls for 2023 were issued in mid-2022 when U.S. GDP figures first showed a temporary dip. Bloomberg confidently assured us back then that a recession would occur within a year with a 100% probability. Since growth has now far exceeded expectations, they shifted their recession call to 2024. But predictions of an imminent downturn for early 2024 will likely not pan out. The Atlanta Fed Nowcast model forecasted a high GDP growth rate for Q3 and was right on the money. Even Q4 is expected to come in at a very respectable two percent. To be fair, forecasters were reacting to a marked reversal in macroeconomic conditions – the interest rate outlook quickly shifted in response to inflation. Interest rates had been very low globally before the pandemic to stimulate growth after the financial crisis. Now, though, economic models are telling us that this natural rate has surged following COVID-19, which means that the Fed can and must raise interest rates to a higher level during this economic cycle to tame inflation and bring the economy back to trend.?
Read the full article here.
Inflation has been way above target for more than two years now, giving monetary policy makers at the Bank of England (BoE) a severe headache. In recent remarks, BoE officials have made it clear that they are now willing to sacrifice the labor market to bring down inflation. While this is problematic in itself, policy makers now face another serious problem related to the labor market data: the official unemployment rate figure in the U.K. has become unreliable! The Office of National Statistics (ONS) just confirmed that it will hold its release of its usual labor market report for the second month in a row. The data points that are being paused include series like the employment rate and unemployment rate for the U.K., which are part of the Labour Force Survey. The response rate has fallen so low that the ONS no longer trusts its own statistics, leading the BoE to make bold decisions without reliable data.?
Read the full article here.
What Recruitonomics is Reading:
Happy Thanksgiving to our American readers! You might have noticed a bit of relief at the grocery store this year while shopping for turkeys, pumpkin pie fixings, or sweet potatoes: Inflation has slowed substantially since last November! Some of the factors that contributed to price increases last year, like avian influenza, have subsided. According to the Wall Street Journal, the typical Thanksgiving feast for 10 will come in at $61.17, a 4.5% decline from last year’s price tag, but still 25% higher than in 2019. For more information on Thanksgiving prices, read the full article from Patrick Thomas.??
?More Data & Insights:
Thank you for reading! Stay tuned for next week's Recruitonomics Newsletter and check out Recruitonomics.com for more data-driven insights.