{"id":12246,"date":"2021-03-23T07:00:00","date_gmt":"2021-03-23T07:00:00","guid":{"rendered":"https:\/\/www.hiringlab.org\/uk\/?p=12246"},"modified":"2022-08-12T18:41:28","modified_gmt":"2022-08-12T17:41:28","slug":"labour-market-recovering-year-into-pandemic","status":"publish","type":"post","link":"https:\/\/www.hiringlab.org\/uk\/blog\/2021\/03\/23\/labour-market-recovering-year-into-pandemic\/","title":{"rendered":"A Year Into the Pandemic UK Labour Market Shows Signs of Life"},"content":{"rendered":"\n<p><strong>Key points:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Shifts in searches toward food, hospitality and beauty &amp; wellness show jobseekers in hardest-hit sectors are ready to return to work.<\/li><li>Job opportunities in those sectors are down more than 60% from pre-pandemic levels, but there are signs of an early pick-up in postings in areas set to reopen soon based on the government\u2019s reopening roadmap.<\/li><li>Jobseekers may find opportunities in sectors that have fully or almost fully recovered such as construction, healthcare and distribution, as well as in occupations which face recruitment challenges, such as social care and nursing.<\/li><\/ul>\n\n\n\n<p>One year on from the first lockdown, the UK labour market remains turned on its head. Swathes of the economy are still shut and furlough has been keeping large parts of the labour market in deep freeze. But the UK\u2019s fast start to vaccination rollout is offering a roadmap out of lockdown, stirring hope of economic revival, particularly of the hardest hit sectors.&nbsp;<\/p>\n\n\n\n<p>The government\u2019s Job Retention Scheme has been extended until the end of September, by which time the economy hopefully will be bouncing back strongly, absorbing slack as support ends.&nbsp;<\/p>\n\n\n\n<p>Furlough means the official unemployment rate \u2014 currently 5.1%, which is low by international standards \u2014 hasn\u2019t risen anything like as much as had been feared earlier in the crisis. However, job opportunities remain well below pre-crisis levels. As of 12 March, job postings on Indeed UK were 31% below the February 2020 pre-crisis baseline.&nbsp;<\/p>\n\n\n\n<p>On the positive side, the impact of the second and third lockdowns on job postings has been nothing like what we saw from the first lockdown. It\u2019s hard to say if there has been any Brexit effect since January. But job posting trends in other European countries have been fairly flat, suggesting the UK\u2019s slow recovery isn\u2019t due, at least entirely, to Brexit.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh3.googleusercontent.com\/9er46dkMqf3hhWr_lS0iJNxEQXKOF1g12ZUTXyIeaS2BqmslvGBW6ScCOn-VsoG0k_Uh0VndmcjiYZuw2Uc4BEbW5_oImz28jybuIP7cJ2FivuCMccxXkfVer8sB7A\" alt=\"Line graph showing job postings on Indeed UK up from the bottom\" \/><figcaption>Line graph titled &#8220;Job postings on Indeed UK up from the bottom.&#8221; With a vertical axis ranging from -60% to 0%, Indeed tracked the percent change in job postings along a horizontal axis ranging from February 1, 2020 to March 12, 2021. As of 12 March, 2021, job postings on Indeed UK were 31% below the February 2020 pre-crisis baseline. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p>Job vacancies are a barometer of an economy\u2019s health, highly correlated with employment and economic output. High vacancy numbers keep unemployment low as employers absorb both new entrants to the labour market, like school leavers and graduates, and workers who become redundant. By contrast, low vacancies mean it\u2019s hard for people to find work as businesses lay off more workers and government wage and income support rolls off.<\/p>\n\n\n\n<p>The mix of jobs is very different from a year ago. The pandemic has had vastly contrasting impacts on different sectors of the economy. Worst-affected sectors have seen job postings fall to fractions of their former levels. At their nadirs, food preparation &amp; service, hospitality &amp; tourism and beauty &amp; wellness had 80-90% fewer job postings than before the pandemic. Workers in shuttered sectors have been looking elsewhere, mainly toward sectors with low entry barriers. But, even as some sectors struggle, others, like social care and nursing, continue to face challenges finding workers.&nbsp;<\/p>\n\n\n\n<p>The lack of job opportunities in sectors like hospitality and retail has been particularly harmful to younger workers with less education. Many of them would normally gain early work experience in these sectors, but the pandemic has pulled this first rung of the career ladder away from them.&nbsp;<\/p>\n\n\n\n<p>If the government\u2019s public health strategy is successful and follows its roadmap for safely reopening the economy, then the hardest-hit sectors could spring back to life in the foreseeable future. That could bring the labour market back to something resembling its former shape, offering hope to struggling jobseekers. The early evidence points to an upturn since the Prime Minister\u2019s announcement, with employers posting more new jobs and jobseeker interest in these sectors rising. To get the labour market back on track,&nbsp;the progress must be sustained and strengthened, and confidence in the recovery must build.&nbsp;<\/p>\n\n\n\n<p><strong>Hardest-hit sectors show early signs of picking up&nbsp;<\/strong><\/p>\n\n\n\n<p>The Prime Minister\u2019s roadmap announcement on 22 February specified conditional dates for a staged reopening of the economy if key health metrics are met. That gave employers visibility and new job postings on Indeed UK have responded. Since the announcement, categories among the first to reopen \u2014 such as sports, beauty &amp; wellness and education &amp; instruction \u2014 have been among those seeing the fastest growth in new postings, which we define as postings on Indeed for seven days or less.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh5.googleusercontent.com\/grGPVaDfpEw7sUh1fyMH9dSttFi9-jqRjvJ8oQTWdJ4UtscjqLrfgSoBdTK4ev_RDtQmG52Pkxr_tL6yAs3NjqW1q3I8UM9vNynCkLNol5XnxRDqF8gMHW8o_XD89g\" alt=\"Table showing new job postings rising in hardest hit sectors following roadmap\" \/><figcaption>Table titled &#8220;New job postings rising in hardest hit sectors following roadmap.&#8221; Indeed compared the percent change in UK new job postings among various sectors between February 1, 2020 and March 12, 2021, including the percentage point change since February 22, 2021. As of March 12, 2021, food preparation &amp; service, hospitality &amp; tourism and beauty &amp; wellness had 80-90% fewer job postings than before the pandemic. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p>The first stage of the roadmap was school reopenings to all pupils beginning 6 March. Outdoor sports are due to resume 29 March. Hairdressers, and nail and beauty salons are scheduled to reopen 12 April, along with nonessential retail. Pubs and restaurants can open for outdoor service on that date, but will have to wait until at least 17 May for indoor service.&nbsp;<\/p>\n\n\n\n<p><strong>Jobseekers anticipating reopening sectors&nbsp;<\/strong><\/p>\n\n\n\n<p>Jobseekers are anticipating opportunities in reopening sectors in their search activity. A variety of hospitality and food service roles are among the fastest-growing search terms on Indeed, along with terms relating to beauty, therapy, gyms, cafes and high street retail.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh3.googleusercontent.com\/ANsEF5ueP6Iw5_docvrrPgXB8GR_blQd-yTkZkT7D0HJXtCFVtQrdMm7asDQZxnRcnU-HFfynQzkmnP5jVrqpvFJeYp-_Cyce_z-eDXRfpqg6bV5Xrl_u0_rgq3W3A\" alt=\"Table showing fastest-rising job search terms on Indeed UK\" \/><figcaption>Table titled &#8220;Fastest-rising job search terms on Indeed UK.&#8221; Indeed listed the top ten job search terms by change in the share of searches between 26 February 2021 and March 12, 2021. Bar staff was top with 98% growth on previous two weeks. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p>We\u2019ve seen these patterns before when the economy exited previous lockdowns. But those opportunities were short-lived as COVID-19 surges prompted reimposition of restrictions.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh5.googleusercontent.com\/PeqZRAFAaoZ0lpZjhd8gpuvEnh6M3ce2cF079N9GUmvEpvRe9z6KUetH819HwZeZYjqllCHtXW3FoIBgkZREEpHOnAxeOY2teWF6RtnXzaGjJgY-GJWI5N6vNgfckg\" alt=\"Line graph showing job searches during the months of COVID-19\" \/><figcaption>Line graph titled &#8220;Search during COVID-19.&#8221; With a vertical axis ranging from 0% to 120%, Indeed tracked the seven day moving average of shares of all searches along a horizontal axis ranging from February 1, 2020 to March 12, 2021 with different coloured lines representing &#8220;bar staff,&#8221; &#8220;chef,&#8221; &#8220;gym,&#8221; and &#8220;hairdressing.&#8221; All four search terms increased following the February 22, 2021 reopening announcement. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p>At the same time, search terms relating to supermarkets, hardware stores, distribution and construction have declined in share. These are sectors supporting the stay-at-home economy and have been more resilient during lockdowns. Jobseekers focused their interest in them while opportunities elsewhere were scarce.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh4.googleusercontent.com\/aW3rCDDnuOKNde4EjvuKx9_nenBC-gruAfflgRNzT0ip5i-9ZEJ_zUDarCDZ2QxMJNUsFCkw1br1g-OCNnSHFqXTykYzxWf1egRr0q747-egXtLqCVnlWrDoR1ez5g\" alt=\"Table showing fastest-declining job search terms on Indeed UK\" \/><figcaption>Table titled &#8220;Fastest-declining job search terms on Indeed UK.&#8221; Indeed listed the top ten fastest declining search terms by change in the share of searches between February 26, 2021 and March 12, 2021. Iceland was top with -46% decline in previous two weeks. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p><strong>The mix of job postings is different than before the crisis<\/strong><\/p>\n\n\n\n<p>At this stage, the overall shape of the labour market is very different from what it was pre-crisis. Few sectors have escaped the downturn, but demand for workers has held up much better in some than others.&nbsp;<\/p>\n\n\n\n<p>On one hand, hospitality &amp; tourism job postings were down 69% on 12 March from the 1 February, 2020, baseline, while food preparation &amp; service postings were off 68% and beauty &amp; wellness 61%. On the other hand, construction postings were 14% above the baseline, while medical technician postings were up 7% and loading &amp; stocking up 3%. Community &amp; social service (-1%), manufacturing (-2%), veterinary (-3%) and real estate (-3%) were nearly at pre-crisis levels.&nbsp;<\/p>\n\n\n\n<p>As a result, the composition of available jobs is different than it was before the crisis. Food preparation &amp; service recorded the biggest drop in postings share, down five percentage points from last year. Sales, administration, customer service and accounting postings have also been declining in share. Conversely, the shares of postings in social care, nursing, construction, software development and manufacturing have increased.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh6.googleusercontent.com\/y8fUYEXoDZSKalNV1aQyoab-uagrpAlkYG3kd98OQRtuVe4xODO7FqOYN7YoNjT5rqiJ94nPz5CTv4APNxhkfKc9txGlycJNkZpATHISjt4tajsA6pBRqNwxnKbv9qyInuBiEbs\" alt=\"Bar graph showing the mix of UK job postings remains different \" \/><figcaption>Bar chart titled &#8220;Mix of job postings remains different.&#8221; Indeed compared the change in share of overall job postings between various occupations from February 2020 and February 2021. Food preparation &amp; service recorded the biggest drop in postings share, down 5% from February 2020. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p>Hopes of a vaccine-driven recovery in the hardest hit sectors raise the prospect that the labour market might snap back to something like its former shape. Such a rebound could make recruitment harder in industries that have been tapping into some of those sector switchers. That would be on top of the increased difficulty recruiting from abroad caused by Brexit and the exodus of foreign-born workers during the pandemic.&nbsp;<\/p>\n\n\n\n<p><strong>Workers in hard-hit sectors are looking outside their occupations&nbsp;<\/strong><\/p>\n\n\n\n<p>Workers in particularly hard-hit sectors, like food preparation &amp; service and beauty &amp; wellness, have been looking at jobs in other sectors. The list below shows the biggest increases in outclick rates to job postings in other categories, based on the most recent job title listed on jobseekers\u2019 CVs.&nbsp;&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh5.googleusercontent.com\/6VfC80ZeSVmlxiifgXxAoBgVJ-Rro6fZDgAWP3lSuQFXBzt9bTzXDTJnZyMmGBopeU2kYkRk0wM3PldqmuIX99HVx9cgtGIHXYonb6sZdLV5KtpfpTFnuV-Q_VAu2Q\" alt=\"Workers in hard-hit sectors looking further afield\" \/><figcaption>Table titled &#8220;Workers in hard-hit sectors looking further afield.&#8221; Indeed listed the occupations with the biggest increases in outclicks rates from Janurary 2020 and Januraru 2021. Food preparation and service was top with 79.1% 2021 share percentage, up 7.3% from 2020 baseline. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p><strong>High competition for jobs in sectors with lower entry barriers&#8230;<\/strong><\/p>\n\n\n\n<p>That interest is generally going toward sectors with lower entry barriers. Jobseeker clicks on postings give an indication of the sectors people are interested in based on their qualifications and preferences. We see which sectors are most competitive by looking at their number of clicks per posting. The sectors that have seen the biggest increases are those that require fewer qualifications and experience, such as customer service, administration and retail. But job postings are still much less plentiful in these sectors than before the pandemic.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh5.googleusercontent.com\/4dxT_i3BrA2-2-CxE-1qguT8iBMvhD09bUGvdSFtgAb-Znp40_oH6vZ7zh_-81U4u7oHiG6UWybrVW9bnwm7HrJSU_mp-4aStp6BlCOszlAJeEcfDWb_1xpJi_mKqA\" alt=\"Table showing customer service and admin have seen the biggest rises in candidates\" \/><figcaption>Table titled &#8220;Customer service and admin have seen the biggest rises in candidates.&#8221; Indeed listed the occupations with the biggest increases in candidates per posting by clicks and posting share between Janurary 1 and Janruary 31, 2021. Customer service was top with an annual change of 121%. Caption added post-publication.  <\/figcaption><\/figure>\n\n\n\n<p><strong>&#8230;but other sectors still face recruitment challenges&nbsp;<\/strong><\/p>\n\n\n\n<p>Other areas of the labour market are not being flooded with applicants. Sectors requiring high qualifications, like software development, healthcare and engineering, still receive relatively few clicks per posting and roles remain relatively difficult to fill.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh4.googleusercontent.com\/6ww3DQZdhfABrNMpOP2nWlRQM1I7f7UHq85NXTLRYzBQMLu4yjCTB1itZlASHHPFccjWOwm70CPrMRv3ebnD-CLoRUuOfSpgadtfP7C0sz4GJm67v_TvZNRFQXv1FQ\" alt=\"Table showing higher skilled roles remain hard to fill\" \/><figcaption>Table titled &#8220;Higher skilled roles remain hard to fill.&#8221; Indeed listed occupations with the lowest ratio of candidates per posting by click and posting share between Janurary 1 and Janurary 31, 2021. Software Development was lowest with an interest ratio of 19%. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p>For some positions, employers have to search hard for suitable candidates. This is particularly the case in social care, a sector in which jobs have long been hard to fill, along with nursing. Brexit may further complicate these challenges. The jobs shown below have been searched for most in Indeed\u2019s CV database in early 2021.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh4.googleusercontent.com\/BxmtnYSk56uU-uLdTmavvCiZBwHTlUD__RMoe6FE26tbfOXiTudms0EO0tx_fewzoUZizsx8G2AzAqz6-yLincYasYUpwXeJO6VAbac3XHO4voWXK7UdOMaj5KOy5g\" alt=\"Table showing employers searching for care workers and nurses\" \/><figcaption>Table titled &#8220;Employers searching for care workers and nurses.&#8221; Indeed listed the most searched for job titles in Indeed CV database in Janurary and February 2021. Care assistant was top with 2.5% share of total searches. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p><strong>Jobseekers continue to cast a wider net<\/strong><\/p>\n\n\n\n<p>Jobseekers continue to be less specific in their searches than they were before the pandemic. Early in the crisis, the share of searches on Indeed UK in which jobseekers specified a location in the \u2018where?\u2019 box and left the \u2018what?\u2019 box blank increased substantially. These searches are a common way for jobseekers to explore what\u2019s out there before narrowing down their job hunt. The share of blank searches is currently around 25%, down from 29% at the peak last summer, but higher than&nbsp;pre-crisis levels. Jobseekers apparently feel they still have to cast a wider net.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/lh3.googleusercontent.com\/ox9HGEcjC3vFvhgTEuCLyxNwZisRsBkQwwgUMePiYrKkGpYbO56l3s8dJhiW5Ir4jFSEuNLJsUSt20tnfzxRWGZR7mqzbfnvWXrX8u4-ujvPmow_UJ5QxTCsL7_OHQ\" alt=\"Line graph showing share of searches with &quot;what&quot; box blank (percentage)\" \/><figcaption>Line chart titled &#8220;Share of searches with &#8216;What&#8217; box blank.&#8221; With a vertical axis ranging from 20% to 30%, Indeed tracked the share of searches with &#8216;What&#8217; box blank along a horizontal axis ranging from June 2019 to March 2021. As of March 12, 2021, the share of blank searches is currently around 25%, down from 29% at the peak in summer 2020. Caption added post-publication.<\/figcaption><\/figure>\n\n\n\n<p><strong>Conclusion<\/strong><\/p>\n\n\n\n<p>Vaccines have shone light at the end of the tunnel and created hope that the labour market in general \u2014 and the hardest-hit sectors in particular \u2014 will recover. Optimism has been building that unemployment will peak lower than feared and <a href=\"https:\/\/obr.uk\/overview-of-the-march-2021-economic-and-fiscal-outlook\/\" target=\"_blank\" rel=\"noreferrer noopener\">well below previous recessionary highs<\/a>. And a release of restrictions may unleash pent-up demand for services, at least from better-off households that have built savings during the crisis.&nbsp;<\/p>\n\n\n\n<p>Already, we can see tentative signs of a pick-up, and these are most welcome. But we\u2019re only at the start of a long road back and the destination remains uncertain. The labour market is likely to be permanently altered in some ways.&nbsp;<\/p>\n\n\n\n<p>In particular, the office is not dead, but we may visit it <a href=\"https:\/\/www.hiringlab.org\/uk\/blog\/2021\/03\/10\/the-office-is-not-dead\/\" target=\"_blank\" rel=\"noreferrer noopener\">less than we used to<\/a>. That will have ripple effects on consumer-facing service sectors in cities, which rely on commuter footfall. Some retail spending will shift back to in-store from online, but probably not to previous levels. And even with domestic relaxation, restrictions on international travel are likely to continue for some time, damping businesses that rely on tourism. All this could mean that some of the sectoral shifts in job opportunities will persist.<\/p>\n\n\n\n<p>The need is ongoing for the right information, support and training to help jobseekers navigate these changes, including greater options for entry-level roles. Such an approach could particularly benefit sectors facing recruitment challenges.&nbsp;<\/p>\n\n\n\n<p><a href=\"https:\/\/blog.indeed.co.uk\/2021\/03\/05\/indeed-and-bit-174000-new-flexible-roles-would-benefit-women-the-most\/\" target=\"_blank\" rel=\"noreferrer noopener\">Increased work flexibility could also help employers<\/a>. The pandemic has upended previous norms and encouraged many employers to rethink ways of working. That re-examination could ultimately be beneficial both to them and their workers.&nbsp;<\/p>\n\n\n\n<p><strong>Methodology<\/strong><\/p>\n\n\n\n<p><em>Job postings figures are the percentage change in seasonally adjusted job postings on Indeed UK since February 1, 2020, using a seven-day trailing average. February 1, 2020, is our pre-pandemic baseline. We seasonally adjust each series based on historical patterns in 2017, 2018, and 2019. Each series, including the national trend, occupational sectors, and sub-national geographies, is seasonally adjusted separately.&nbsp;<\/em><\/p>\n\n\n\n<p><em>For the mix of job postings, we compare February 2021 with the same period a year ago to account for seasonality in the demand for new workers.&nbsp;<\/em><\/p>\n\n\n\n<p><em>For searches of Indeed\u2019s CV database, we compare January and February 2021 with the same period a year ago.&nbsp;<\/em><\/p>\n\n\n\n<p><em>For search terms analysis, we looked at the top search terms on Indeed UK as a share of all searches from February 26 to March 12. We looked at both the change in searches versus the previous two weeks and the change versus the same period one year ago to account for possible seasonality of search patterns. We accounted for fluctuations in search behaviour by calculating the seven-day moving average of each term\u2019s search share.<\/em><\/p>\n\n\n\n<p><em>For outclick rates, we identify the current occupation of the jobseeker from the most recent job title listed on their Indeed CV. Outclicks are clicks on jobs in different categories than the jobseeker\u2019s current occupation.&nbsp;<\/em><\/p>\n\n\n\n<p><em>Candidates per posting is calculated as the share of clicks on a category divided by the share of job postings in that category.&nbsp;<\/em><\/p>\n\n\n\n<p><em>Information is based on publicly available information on the Indeed UK website and any other countries named in the post, is limited to the UK and other countries specifically named, is not a projection of future events, and includes both paid and unpaid job solicitations.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>With reopening roadmap, early signs of pickup in worst-hit sectors.<\/p>\n","protected":false},"author":36,"featured_media":12250,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"recruiter-hub-blocks.php","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"post_mwm_category":[349],"post_topic":[],"post_content_type":[],"post_duration":[],"post_actions":[],"post_franchise":[],"post_mwm_author":[305],"class_list":["post-12246","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","post_mwm_category-state-of-the-labour-market","post_mwm_author-jackkennedy"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - 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