Wages have been outpacing inflation since March 2018.
Wage growth in the UK accelerated to 3.6% in the year to May 2019, the highest rate since 2008, according to Office for National Statistics figures. This shows that the labour market continues to be strong, which is great for employees but a real hurdle for companies looking to recruit.
Employers are struggling to navigate tight labour pools due to the lowest unemployment rate for decades. In fact, two thirds of employers have had to offer higher salaries to new recruits than those paid to existing employees because they were struggling to fill their roles.
New data from CV-Library reveals that average salaries across the UK have reached a five-year high, climbing to a record £36,493 in the first half of 2019.
The biggest increases in jobs advertised were seen in engineering (+26.5%), construction (+21.7%), IT (+24.2%), distribution – (+58.7%) and manufacturing (+44.1%). With the uncertainty of Brexit, a huge amount of vacancies are being left unfilled because Brits are too afraid to change roles right.
There is real concern that if the government does not focus on boosting the UK economy, then a high number of UK companies may reach breaking point in the next six months.
Not all businesses are in the financial position to offer monetary rewards to attract and retain top talent. So, what can they do instead? Some things to consider include:
- flexible working schemes for a better work-life balance
- robust career development programmes
- creative agile working environments
- improving company culture and brand
Another robust way of closing the skills gap is to consider apprenticeships. National Apprenticeship service data has shown that 80% of companies that have apprenticeship schemes report higher retention rates. A key benefit with apprentices is that you have the opportunity to mould them to your own culture and way of working. The investment you make in apprentices is very often repaid in their loyalty and commitment to the business, helping you to create a strong workforce and equally strong company culture and brand.