It is easy to forget, with the passing of time, that the country entered 2013 with most commentators predicting an almost inevitable decline into a triple dip recession. By the time the year ended, unemployment rates had experienced record falls and the IMF had upgraded Britain’s GDP growth forecasts for the third time ahead of any developed economy other than the US.
Much had clearly happened and job creation must have been at the heart of that change. Our high level data supports the narrative of positive momentum:
- Job vacancy growth across the country for the year was 5.5%.
- 2012 had seen growth when compared with 2011,
- But whilst 2012 had seen levels declining through the year after a strong start, 2013 was a year of consistent improvement.
The sectors that showed the biggest improvements were not surprising. Automotive was the standout sector with growth of 47%, which backs up the news coming from that sector that after years of depression, performance levels are back to those of the pre-recession period. Other top performing sectors are those driven by infrastructure investment and government stimulus such as Building and Construction and Rail and Transport. Public sector hiring has also recovered from prior years, but this growth is all relative and results from the low base.
The sectors that showed the highest reduction in hiring levels merit some consideration. The biggest fall was in Travel and Tourism which fell -12%. We believe this is likely to have resulted from high hiring levels in prior years whilst building up for the Olympics. Hiring volumes remain relatively low in the graduate market as times remain tough for Britain’s youth. Interestingly retail hiring volumes fell year on year, even though most official statements suggest that the current recovery is largely driven by consumer spending. This is likely to be a result of a shift away from bricks and mortar retail towards online.
Of the 48 sectors to which Broadbean’s clients post job adverts, 30 of these have shown growth in vacancy volumes. Whilst this perhaps doesn’t suggest the recovery is as broad based as one would hope, it does suggest a healthier momentum than previous bounces during this recession. Our data also suggest that all regions of the country have experienced growth. The relative growth levels are slightly skewed by the volumes of adverts we post, but the picture is consistently positive.
One area where the news is perhaps a little less certain is salary levels. After five years of stagnation the growth in average advertised salaries from our data was only 1.2% during 2013 and still a long way below cost of living increases. This means that household incomes are continuing to be squeezed which at the end of the day is a risk to the recovery. Even here, however, there are some bright spots on the horizon. The second half of the year saw advertised salary levels increase by 1.7% while inflation levels are falling. We have also seen application per vacancy rates start to fall in the second half of the year. If job levels remain high and application per vacancy rates continue to fall in line with the falling unemployment rates this is likely to result in less downward pressure on salaries.
All in all, whilst the trends are not exclusively positive the overall picture appears bright. Over the year there has been strong growth, but also the trends through the year have been strong. This points to good momentum, which encouragingly has been continued at the start of 2014.