Earlier this week, data from the Recruitment and Employment Confederation showed that there were 1.7 million active job adverts in the UK during the last week of August with around 193,000 new job adverts posted during those seven days.
In fact, its research shows that the number of new jobs being advertised has remained high over the last three months with Wales having the highest active job postings during this period.
However, as the press has highlighted recently, all businesses (but especially those in the hospitality and haulage industries) have struggled to get the workers they need with some having no option but to reduce their operations as a result.
Of course, the jobs market is still not as clear cut as it was prior to the pandemic, and we will have to wait and see how the gradual closure of the Coronavirus Job Retention Scheme – where employers could furlough those employees at risk of redundancy due to the pandemic – will pan out in terms of creating opportunities in the jobs market.
For example, a recent study from the British Chambers of Commerce indicated that 1 in 5 companies were considering staff redundancies when furlough ended but will there be enough potential employees from this pool available for these vacancies when this happens?
If we examine the latest data on the furlough scheme from HMRC, then it suggests a mixed picture for UK economy over the next few months.
As of July 2021, 11.6 million workers had been furloughed since the programme was launched in the spring of 2020. However, the number of people on furlough at the end of June 2021 had reduced significantly to 1.9 million with 69,000 employed in Welsh businesses.
The sectors with the highest rates of jobs furloughed were those that were still largely unopened at the time such as passenger air transport (58%), travel agency and tour operator activities (49%) and the creative industries (34%).
Interestingly, hospitality-based sectors - such as the beverage serving activities group and the restaurants and mobile food service activities group - have seen the largest reduction in jobs on furlough between 31 May and 30 June as the economy reopened (with a decrease of 102,500 and 95,760 respectively). However, these still remain the sectors where there are still considerable numbers of staff being paid through the furlough scheme.
With 28% of UK employers still having staff off work through the scheme, the latest data also shows that it is the microbusinesses (or those employing less than ten people) that have taken most advantage of the furlough scheme with 20% of their eligible workforce currently using the programme as compared to 2% of large firm employees.
In addition, it would seem that bigger firms have quicker in getting their employees back to work over the last few months with a 79% reduction in those on furlough since the peak in January as compared to a 33% reduction for firms with one employee.
To some extent, this may reflect the sectors in which many microbusinesses are operating but it could suggest that smaller firms are still dependent on UK Government support programmes as they look to return to economic activity.
If we examine the scheme by gender and age, we find that 52% of all those still furloughed are male with a slightly higher proportion for those working in Welsh companies.
This contrasts with the situation at the height of the lockdown when more female employees were furloughed. Indeed, more women had left the furlough scheme in the previous month possibly due to the type of sectors reopening in May 2021.
In terms of age, there has been an interesting change over the lifetime of the furlough scheme. For example, back in July 2020, 20% of those furloughed were under 25 years of age and as a result, there were concerns as to whether, when the economy re-opened, there would be a “lost generation” of young people as a result of the pandemic.
Yet if we examine the data for June 2021, this had dropped to 11% of those furloughed, representing a decline of 77% since the beginning of the year – a higher fall than for any other age group.
This means that there are currently only 207,000 young people remaining on furlough and this could either be reflecting the type of sector reopening during the last few months or be an indication that some have decided to enter full-time education. In Wales, 12% of those still on furlough were aged under 25 of age (or 8000 young people) which is slightly higher than for the UK as a whole.
Therefore, there remain challenges in terms of managing the labour market in the UK especially in addressing the job vacancy crisis in key parts of the economy.
Whilst there may be a proportion of those on furlough which may be made redundant, this will still not be sufficient in filling those jobs which are currently available even assuming that they had had the relevant skills and experience.
To date, skills and training has not been at the forefront of government policy either nationally or within the devolved administrations and a better trained workforce will be key to addressing the deficit between increased numbers of vacancies and those with the skills to take those roles.
And whilst having more jobs available in the economy is a positive problem to have, filling those jobs remains a significant challenge that politicians and policymakers need to start addressing quickly if the UK economy is to grow over the next few years.