Received wisdom states that in a recession the first things to be cut are Recruitment and Marketing. So, as we head into (or possibly continue in) this recession you’d expect UK Talent Acquisition professionals might need to batten down the hatches as the storm approaches, but I believe this recession may well be different from all other proceeding downturns – we need to retain perspective and avoid being overly pessimistic.
Why? Well, the fundamental conditions in the recruitment market are untypical of those of a usual recession – we’re starting from a much different place than we have done in the past. Brexit and early retirement during Covid have taken over 500,000 people out of our job market. We currently have 1.2m vacancies (ONS December 2022), we have the highest number of people (36.2m) ever employed in the UK (ONS Sept 2022) and industries (such as Healthcare and Tech) simply cannot hire to keep up with demand. Furthermore, in the 2008 recession unemployment reached 10%, whereas the OBR is forecasting the current unemployment level of 3.7% will increase to 4.8% in 2024 before falling back to current levels in 2026.
Therefore, it’s probably wiser to look upon the next two years as a period when an over constricted market will slightly (and perhaps temporarily) ease, as opposed to period of doom and gloom. I’m not saying that all companies and sectors will be immune from economic headwinds, but many employers will still find it hard to attract and retain the talent they need to grow and succeed. In the last few years, it’s often been virtually impossible to find and keep great people, and perhaps now it’s just going to be tough!
So, I’d advise organisations to ignore the Merchants of Doom and continue to invest in attractive employer brands and effective engagement strategies that persuade talent that yours is a safe place for them to join, grow and perform. I have no doubt that the Finance Directors will be targeting Talent/HR budgets as an easy/quick saving, but we need to encourage them to look elsewhere – the War for Talent is far from over!