Yorkshire jobs: Research shows regional labour market is beginning to slow

The Labour market in Yorkshire is on the verge of reaching its peak, with recruitment bosses counselling restraint over pay awards.

The latest CIPD Labour Market Outlook report for the region showed that currently employers in Yorkshire are pulling out all the stops to attract and, in particular, to retain staff.

However, with high inflation eroding pay packets and a recession forecast for the end of the year, the region’s labour market could soon reach its peak, it warns.

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The prediction comes after a buoyant period for the region’s labour sector, with the quarterly survey of senior HR decision makers indicating that hiring intentions remained strong.

Regional jobs market is slowing.Regional jobs market is slowing.
Regional jobs market is slowing.

Research from the CIPD - the professional body for HR and people development - showed as many as 40 per cent of employers in Yorkshire and Humber are expecting to recruit in the next three months.

However, close to half of these have hard-to-fill vacancies.

When asked what needed to be done in order to tackle such recruitment and retention challenges, the top response from employers has been to upskill more existing staff followed by advertising more jobs as flexible, hiring more apprentices and by raising wages.

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On the latter the report also found that pay award expectations have hit a record high in the private sector, rising to a median of 4 per cent, the highest of any sector in the Labour Market Outlook’s current time series since it began in 2012.

The median expected basic pay increase across all sectors continues at 3 per cent.

In response the CIPD is warning that pay increases cannot be sustained over the long-term so employers should look at other ways of supporting financial wellbeing in the cost-of-living crisis, such as enhancing their overall benefits package.

Jonathan Boys, labour market economist for the CIPD said: “We’re seeing some of the highest pay awards in recent history as employers strive to attract and retain staff. However, strong pay growth can’t last forever.

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“To deal with the cost-of-living crisis, employers will have to look at other ways they can support their people. Employer benefits that help reduce the cost of housing, travel and childcare will be of particular value to those on the lowest incomes.”

He added: “Employers are taking numerous measures to keep their existing people by upskilling staff, increasing wages and improving job quality. This makes it a good time for the Government to capitalise on employer appetite for upskilling.

“It’s vital employers have the right support mechanisms in place to access the training they need. Reform of the apprenticeship levy could help by enabling organisations to spend the levy on training that best suits their business’s needs at this crucial time.”