Hire Expectations

Research reveals the huge impact of Covid-19 on UK businesses

While businesses across the country have started the process of coming out of the Covid-19 lockdown, employers are reporting the weakest Outlook since records began in 1992, according to the latest ManpowerGroup Employment Outlook Survey. Hiring intentions for the third quarter of 2020 are down to -12%, with a sharp drop across all major sectors. However, employers remain cautiously optimistic that this will be temporary with over half (57%) of employers expecting to return to pre-Covid-19 hiring levels by this time next year.

The ManpowerGroup Employment Outlook Survey is based on responses from 1,056 UK employers. It asks whether employers intend to hire additional workers or reduce the size of their workforce in the coming quarter. It is the most comprehensive, forward-looking employment survey of its kind and is used as a key economic indicator by both the Bank of England and the UK Government.

The research reveals the huge impact of Covid-19 on UK businesses. Nearly half of employers report that 50% or more of their normal business activities have been suspended. The difference across sectors is stark: while 40% of companies in the Financial and Business Services sector have seen significant levels of disruption, that rises to 72% in Retail and Hospitality. Mark Cahill, Managing Director, ManpowerGroup UK says: “While there’s no getting away from the challenges that lie ahead, the data underlines the resilience of UK employers.

Cahill continues: “It is worth reiterating that around three quarters of employers we spoke to expect to retain current staffing levels in the coming quarter and just over half expect to return to pre-Covid-19 hiring levels during the beginning of next year. The level of disruption is unprecedented and many will be looking closely at what happens next with how Covid-19 progresses, how consumers respond and what all this means for their own operations.”

The turbulence in every sector has put an even greater emphasis on speed and agility. Cahill again: “Many employers have shown tremendous adaptability during these difficult times and often it’s the social distancing requirements rather than a fall in demand that is driving change. The Manufacturing sector Outlook may be down to -15%, but big manufacturers still need to hire for key roles in order to keep factories running. By shifting their training programmes online, a number of our larger clients have transformed the way they onboard new recruits. This ensures that new hires can hit the ground running from Day 1. And it’s not just training  – businesses organisations of all sizes, including global businesses which would often have long lead times, whose products such as face masks have been in high demand throughout the crisis, have accelerated their internal processes, reducing lead times for contracts from months to weeks or even days.”

Cahill again: “The uniquely difficult circumstances will mean that some of us will do roles that have never existed before and others will never do the same role again. In the past few weeks we have seen thousands of requests globally for roles that have never existed before, such as contact tracers and temperature checkers. Covid-19 has also brought industry competitors closer together:  in our own industry, employment services, we are collaborating with other leading HR providers as well as government and business groups to help employers around the world get back to work in the new normal”.

There are only a few of bright spots among the sectors in terms of hiring intentions for Q3 2020. The public sector is still positive (+2%), and Agriculture is the cream of the crop, rising by nine percentage points to +11%.  However, some of this optimism is driven by the staff shortfall caused by the quarantine restrictions on travel. Cahill adds: “The public sector – particularly our care homes – and the UK’s agriculture industry are some of the sectors that are most reliant on migrant workers. UK farms need around 90,000 seasonal workers for the April to October harvest. It has been impossible to ignore the huge advertising campaign ‘Pick for Britain’ in the newspapers and TV backed by Waitrose, ITV and the UK Government demonstrating the scale of the problem. The significant positive hiring intentions in the sector illustrates how employers are desperate to fill this shortfall.

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