Here’s what happened to the UK professional jobs market in 2018 and what to watch out for in 2019
It is not unusual after the rest and relaxation of Christmas for people to consider their current career path and decide to search for new opportunities. But it’s also important for these prospective jobseekers – and hiring managers – to look back at the previous year, in order to learn about the current state of the market and where the best opportunities lie.
It is impossible to reflect on the job market last year without acknowledging the B-word. Uncertainty around Brexit appeared to be creating a fear of “last in, first out”, which in turn meant that employees were less willing to move roles as swiftly as they had in previous years.
As a result, employers had to contend with a UK-wide candidate shortage across most disciplines, despite demand for specialist and highly skilled mid-level and senior professionals.
Here’s what happened, and how the state of play looks for the year ahead.
A good year for industry outside London
The UK remained a so-called two-speed economy in 2018: London-based financial services firms experienced slow growth due to Brexit-related concerns, while non-financial services companies outside the capital grew much faster.
Manchester, Leeds, and Birmingham have been particularly successful in positioning themselves as regional tech-hubs, attracting talent that would have historically migrated to London.
Tech leads the way
The technology industry was one of the fastest-growing markets across the whole of the UK in 2018 – growing at three times the rate of the main economy. Given the innovative and highly skilled nature of the industry, there was an ongoing shortage of suitably qualified candidates.
Fintech, fast-moving consumer goods, online, and financial services employers were all active in recruiting digital professionals in 2018. Demand was high for specialists in business intelligence, data analytics, security development, architecture, and digital, in both permanent and contract roles.
Looking ahead to this year, demand will increase for interim talent as employers implement data, digital, and transformation projects. Companies will continue to invest in their security, architecture, and data capabilities, driving up salaries in these areas.
In 2019, employers will particularly struggle to source developers, software architects, customer-relationship management specialists, and data and security professionals for both permanent and interim roles, as demand continues to outstrip supply.
Banking chooses caution
Due to uncertainty around Brexit, banks and financial services firms took a relatively cautious approach to recruitment, characterised by replacement hiring. The exceptions were compliance, risk, and audit, with these professionals in high demand due to the pressure from regulators.
It won’t come as a surprise to learn that the key determinant of hiring market conditions in 2019 will be the outcome of Brexit. On this, we can only wait and see, but the above skills will always be highly sought after.
Finance professionals are in demand
In both commerce and industry, demand for finance professionals remained strong across the UK in 2018, from part-qualified accountants through to finance directors.
As candidates now understand their worth, they are increasingly pushing for commercial or strategic roles, rather than core reporting positions.
We are expecting a continued need for industry-trained management accountants at the recently-qualified (£50-£55,000) level in 2019. This is particularly the case for financial planning and analysis roles, where a commercial outlook and hands-on skill set is highly desirable.
Traditional finance functions will begin hiring at all levels, as general business growth is likely to continue. We are especially likely to see an increase in interim and temp roles within commerce finance, as companies prepare for Brexit.
Competition in the law
Hiring throughout the legal sector became increasingly competitive in 2018, leading to firms paying a premium for experienced lawyers across most skill sets. This rise in demand was partly due to a lack of lawyers at the two-to-four-year PQE level, caused by a reduction in the number of trainees being hired a few years ago, and was coupled with an increase in European regulations.
This year, we will see an increase in hiring for areas such as disputes, insolvency, employment, and other specialisms which tend to be more counter-cyclical. Private practice will continue to see dropout rates, with lawyers either making the move to in-house positions, or leaving law entirely.
It is likely that we will see further salary increases from US firms, with local competitors following suit in order to remain competitive.
Future-proofing
Technology-aligned companies and VC-backed startups show no signs of slowing down, and the rate at which they continue to attract investors will be a big pull for candidates who are looking to future-proof their careers. Candidates with a hybrid skill set, commercial awareness, and who are IT proficient with strong communication skills will be highly sought after.
Within operations, we anticipate a shift towards contract hiring, as the outcome of Brexit will push organisations towards employing a more agile workforce. Professionals with strong systems skills will be in demand, as firms look at robotics and automation to reduce costs.
A word of advice
So what can you do to ensure that your business get the talent that it needs? We advise that firms facing candidate shortages should be flexible, and consider hiring professionals with transferable skills.
Companies should also think about taking on candidates who are ambitious and fast learners, even if they are not an exact fit for the job description, in order to support areas of growth within the business.
Meanwhile, candidates looking for a new role should embrace digitalisation and innovation to ensure that they remain current and relevant in changing working practices.
In-demand professions or specialist roles will continue to command a price premium, but general salary inflation will depend on the outcome of Brexit and other variable macroeconomic conditions.
With UK employment at a record high, and unemployment at its lowest level since 1975, competition for qualified candidates is high. While this might be a frustration for some firms, it is golden opportunity for those professionals seeking their dream role.