The Wave January 2023 Recruitment Trends Report has revealed a huge rise in applications in January, with levels higher than in any month in 2022. Following two years of candidate shortages, this is welcome news. Jobs also rose but not by the same extent, indicating the gap between jobs and applications may finally be beginning to close.
Following a month that saw significant falls in both jobs and applications, January has boomed. The new year, new job trend has truly kicked in, with applications 57% up month on month. Jobs have increased too, by a decent 25%, but not in the same league as application rises. This has caused the average application per job to rise by 3, from 13 in December to 16 in January, which equals the highest seen in 2022.
IT & Internet again posted the highest percentage of jobs and received the highest percentage of applications, making it the most active industry in January.
Tuesday was the most active day of the week for both jobs and for applications – it was the day the majority of jobs were posted and the day most applications were received.
In terms of the most active day of the month, the greatest percentage of jobs were posted on 4th January, one day after most agencies returned following the bank holiday. Most applications were received on 17th January, two weeks later, once schools had been back a full week and people had started to settle into the new year – it was also the day after ‘Blue Monday’, perhaps prompting many to make positive changes.
The new year got off to a great start in terms of candidate activity. Applications were 32% over the 2022 average, higher than in any month in 2022. An increase in job activity is a seasonal trend as people kickstart the new year searching for a fresh start but these numbers indicate a surge of candidates entering the market, probably as result of a number of factors. The cost of living crisis has prompted people to look for better compensation in other jobs as well as force people out of economic inactivity and back into the market. The ONS reported a decrease in the economic inactivity rate towards the end of the year, driven by those aged 50 to 64 – largely those returning to the job market from retirement to meet increased living costs.
Jobs increased from December but were only 5% over the 2022 monthly average – lower than any month in the first half of 2022 bar April. The general jobs figures for the latter half of 2022 and January 2023 point to a slow-down in jobs as the economic situation worsened in the UK and talk of recession began. This mirrors findings from the ONS that vacancies have been falling for several consecutive quarters. It certainly seems like we are now seeing caution in the market ahead of what is forecast to be a challenging year economically.
IT & Internet continues its domination of both jobs and applications. The industry posted 24% of all jobs in January, 8 percentage points higher than the industry posting the second highest numbers of jobs, Health & Nursing. It received 17% of all applications, giving it the greatest share but dropping by 6 percentage points from December.
Both Education and Manufacturing feature on the charts for high jobs and applications, suggesting they also continue to be busy for all the right reasons.
Health & Nursing increased its percentage share of jobs in January but received a low percentage of applications, indicating that the industry’s skills shortage could be deepening. Public Sector also posted a relatively high percentage of jobs but without receiving a similar share of applications.
Secretarial, PAs & Admin received a high percentage of applications again in January, increasing its share by 4 percentage points from December, but didn’t post a high percentage of jobs. This is the same challenge faced by Engineering – a relatively low percentage of jobs but a high percentage of applications, also 4 percentage points higher than December.
Accountancy received a huge average of 58 applications per job in January – 23 more than the next highest (Retail & Wholesale) and 38 more than they received in December. Finance is also in the top 5 for highest average numbers of applications per job. In the December Recruitment Trends Report we touched upon the popularity of financial services industries in times of uncertainty and turbulence due to their perceived stability and this is what we might be seeing here. Job security has become one of the highest priorities for jobseekers.
Retail & Wholesale received an average of 35 applications per job, also a substantial increase from December. This could be connected to an increase in those talking on second jobs to help with soaring costs of living as Retail & Wholesale can often involve shift and evening work.
On the flip side, Health & Nursing received an average of just 2 applications per job – a stark reminder of the critical skills shortages that continue to challenge the industry. Not for Profit, Charities received an average of 5 applications per job but this was an increase of 1 from December. All other industries with low numbers, bar one, also increased their average month on month. Construction is the exception. The industry has faced a persistent skills gap for many years and a recent survey found that 75% of contractors currently have issues recruiting skilled operatives.
Niche job boards account for 3 of the 5 job boards that received the highest average numbers of applications per job in January. Caterer received the most, with a high average of 32 applications per job. Secs in the City was second with 23 and JobServe was 5th with 16. The 3 generic job boards in the top 5 were Totaljobs with 22 and reed.co.uk and CV-Library with 8 each with. The data suggests that those industries with niche skills are well served by niche job boards.
As a trusted source, the labour market statistics published by the Office for National Statistics are used to help inform a range of government policies and are heavily used by the recruitment industry as a barometer of the state of the job market.
What we see this month echoes Wave’s data – vacancies are decreasing, the economic inactivity rate is also decreasing, and the unemployment rate is increasing, pointing to fewer jobs but a rise in applications as the candidate pool starts to fill.
A report by thinktank Centre for Cities has calculated that the real unemployment rate in the UK may be nearly three times higher than official figures. While the official rate is 3.7%, when you account for the 3 million economically inactive people that rate triples to 12.1%. Nine of the ten regions with the highest economic inactivity rates are in the North of England, with one in Wales.
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In Wave’s Annual Report we dig into the recruitment trends that characterised 2022, including how the job market evolved over the year.
