Recruitment challenges 2023 - What to expect from the job market

What recruitment challenges will businesses face in 2023?

If there is one thing we have all learnt over the past three years, it is that the recruitment industry needs to be agile and quick to react as workplaces rapidly change and evolve. Recruitment challenges in 2023 are likely to follow the pattern of recent years. Hiring strategies need to be constantly reviewed, assessed and updated with new insight to ensure they get results. It is something that has meant a rapid period of development internally in many recruitment agencies, and they have become stronger and more efficient for it.

In 2022, recruitment problems were at record levels as three out of four companies struggled to hire staff in the UK, according to the British Chambers of Commerce. The construction sector faced the biggest challenge, followed by the production, manufacturing, and hospitality industries. UK manufacturing companies have already been forced to cut jobs and production because of soaring energy costs.

The corporate world is still recovering from the global pandemic, reeling from the Great Resignation, and adapting to changes in the way we live, such as remote working. Add to that the economic uncertainty, interest rates challenges, changes to visa rules and supply chain issues, and many predict a reduction in hiring in 2023.

But instead of organisations introducing hiring freezes or reducing numbers, it should actually be seen as an opportunity to spot new recruitment trends and have a sharper focus on ensuring the right high-quality candidates are secured for permanent job roles.

Navigating candidate shortages

A key recruiting challenge in 2023 is a shortage in candidates to fill key existing roles in the labour market. This is partly due to a reduction in international travel, meaning a reduced supply of international candidates.

Businesses are already competing for the best staff in the market, so solutions that introduce new staff into the talent pool could be one important development. The opportunity to hire overseas workers through agencies like RE Recruitment introduces a new way to deal with seasonal demand and labour shortages. Whether it’s recruiting a high volume of workers on a seasonal recruitment drive or hiring a senior level executive from overseas specialist seasonal worker schemes are in place to help UK businesses. Schemes such as the UK seasonal poultry worker scheme help businesses to navigate visa regulations and requirements whilst hiring thoroughly vetted and professional staff.

Learn more about the benefits of hiring seasonal workers.

An employee led market

Firms must be encouraged to unlock talent pools by investing in training, adopting flexible working patterns, and expanding the use of apprenticeships. This can be particularly difficult when budgets are being cut, but retaining staff and investing internally can stimulate company growth and minimise the cost of recruitment going forwards.

The challenges for businesses are the options available to candidates as we remain in an employee led market.

An Employee led market is a popular term in the recruitment industry where the market is driven by candidates rather than businesses. This sentiment is explained by year on year growth in new job roles becoming available on the market, exceeding the number of candidates looking for work.

Competition with ‘smart’ recruitment solutions such as AI

Artificial Intelligence (AI) is a rapidly growing field which has the potential to transform many aspects of our lives, and in particular our work life. ITV news recently focused on the popular AI content generation tool, Chat GPT and the issues teachers will face grading work.

For businesses looking to recruit, the use of this AI technology can be used to create job descriptions in seconds vs hours. Whilst this sounds great in principle, the data from the tool can be considered robotic and generic, meaning lots of duplicated content flooding the job boards.

Whilst AI recruitment software can identify talent, screen CVs, reduce bias, and communicate with prospective candidates via chatbots it cannot replace the person to person relationships that can be built by your team during the recruitment process.

Growing your brand during a economic crisis

Workers are increasingly nervous about moving roles when the economy already feels a little unsteady, so more thought is going into career moves than ever before. This might seem like a benefit to businesses who are able to keep staff longer, however your staff need to be motivated to ensure they are not staying for the wrong reasons.

The ‘community’ feeling that workers used to get in offices is now largely obsolete due to increased remote working, meaning that there is often less workplace loyalty.

Employers need to promote the ‘company brand’ internally to create a positive company culture to attract and retain talent. Scheduling staff social events whether remotely or in person are a great way to allow staff to reset and reconnect away from the pressures of work. For larger teams or teams split across locations/countries, having separate events for teams is a guaranteed way to increase staff participation.

Evolving strike regulations

With numerous industries – including postal staff, railway crew and ambulance drivers – already having voted to strike in 2023, there is a lot of change on whether contractor recruitment agencies are legally permitted to supply workers to replace striking staff.

Despite regulations prohibiting agencies from introducing or supplying agency staff during a strike, ministers last year said they would revoke restrictions so that employers could plug staffing gaps with temporary agency workers. It’s an area of rapid change, but undoubtedly a key area for recruitment in 2023.

Prioritising Staff Retention

Organisations have always been acutely aware how essential it is to retain quality talent. Recruiting new employees is essential for a company to grow and to bring fresh talent and ideas through the doors, but it’s also more valuable than ever to recognise the potential in the staff you already have.

For businesses that operate with temporary staff our blog on how to motivate your temporary employees is a great place to start. We cover 10 easy to implement, yet often overlooked, changes you can begin implementing immediately.

For businesses with long term growth goals hiring quality permanent staff who are keen to develop is key. Companies with low rates of employee turnover not only find it easier to grow, but the fact also serves as a great incentive for people considering joining your organisation.