Demand for new staff outstrips supply creating a hike in starting salaries
Businesses have seen starting salaries increase over the last month, while growth in demand for staff hit a new high as Covid restrictions eased and economic activity was boosted. A recent report has found that starting pay for new joiners experienced the sharpest increase since the survey began in October 1997. It was estimated that nearly half of the 400 UK recruitment and employment consultancies surveyed said they had recorded higher starting salaries.
This demonstrates that salaries for new hires has increased at the fastest rate in 24 years. But demand for new staff is currently outstripping supply because of low candidate availability and with furlough due to end soon, there may be a downward pressure on pay still to become evident.
Businesses polled for the report have also stated that demand for staff outstrips supply. More than half of the survey panel said they had noted higher permanent job placements, compared to less than 16% that noted a fall. Pay increases alone won’t solve the demand and business owners are calling for an immigration system that flexes to meet demand with a long-term plan for upskilling workers.