The wider recruitment industry has responded to the Government’s budget yesterday with a mix of positivity and caution.
Ian Nicholas, Global Managing Director at Reed called for a balanced approach to supporting both workers and employers. He noted that higher wages may provide a boost for household, but it could also have a negative impact on job creation going forward. “At a time when many households are struggling with the cost of living, higher pay is welcome and can make a meaningful difference to people’s lives,” he noted. “But higher wages alone are not enough if there are fewer opportunities to earn them. The risk here is that rising employment costs make businesses more cautious about hiring, particularly those taking their first steps into the workforce.”
Nicholas said his company’s research shows employers remain committed to investing in young talent, with 73 per cent saying early talent recruitment is a high priority but that commitment is being tested. “More than a quarter say training costs are preventing them from hiring more young people, while 26 per cent cite budget pressures and 22 per cent point to wider recruitment and employment costs as barriers,” he said. “For young people already struggling to get a foot on the career ladder, that’s a worrying signal. Every entry-level role that isn’t created is another opportunity lost, another individual left on the sidelines, and another business missing out on future talent.”
“There’s a lot to welcome in today’s Budget,” said Lucy Kemp, Chief Marketing Officer at La Fosse, “especially the investment in AI security, cyber and chip design.
Kemp says that as AI has taken off, security and cyber haven’t kept pace, and businesses have been chasing their tails. “The government has recognised that and is putting real money behind it, which is exactly what we’re seeing in the market,” she said. “Demand for these roles is only going to grow, so consistent backing will make a real difference.”
Kemp also draws attention to issues around entry-level jobs acknowledging they are harder to find and that pay is rising more slowly than before. “I think the entry-level market will recover, but in the meantime we need to give this generation real reasons to feel positive about work,” she said.
“On the gender pay gap, acting on pay transparency in job adverts won’t close it on its own,” added Kemp. “The bigger issue for women is the wealth gap. Women retire with far less than men because they step out of work to raise children, care for relatives or manage menopause, and pay less into their pensions as a result. If job adverts showed how employers protect roles during leave and support women back into promotion, that would make a real difference.”
Finally, CV-Library CEO, Lee Biggins, said while the Budget added no new employment costs, it did little to tackle the underlying barriers preventing businesses from creating jobs.
“For most businesses and for the jobs market this was a ‘nothing’ budget,” he said. “Nothing added to the already higher employment costs – we can be thankful for that – but nothing done to ease them. That’s despite acknowledging the challenge of youth unemployment; there was nothing meaningful in this budget that creates the jobs needed to get them into work.
“It feels as though the Government’s big jobs bet is on the creation of a new National Wealth Fund and wider investment measures,” he added. “Greater investment is welcome, but it’s not just a lack of investment holding back job creation, it is the high cost of employment.
“Employers will want to know how today’s headlines will create the conditions to increase hiring, particularly for younger workers struggling to step into the labour market,” Biggins concluded.
