Nearly half a million more people are expected to enter the workforce in the next 12 months, according to new research by the Institute of Chartered Accountants in England and Wales (ICAEW).
The Institute’s report suggests that more than 450,000 new jobs will be created in the private sector in the year up to the next election, adding to the rise in employment that started last year.
According to the group’s Business Confidence Monitor, small and medium-sized enterprises (SMEs) will lead the way in job creation, although finding enough people with the right skills could be a challenge.
The Institute’s research echoes the findings of the Confederation of British Industry’s (CBI) latest SME trends, which states that employment in the smaller manufacturing sector has risen by 16 per cent on the last quarter and is expected to grow by a further 24 per cent in Q2.
According to the CBI, output expectations for the next three months are also at their highest in nearly two decades. Their survey showed that a net balance of 16 per cent of small manufacturers said they were hiring in the three months to April, further signalling that the unemployment rate is set to continue its decline this year.
However, their research concurred with the Institute’s in that some firms are having trouble locating skilled employees. Some 20 per cent of the construction companies polled said they are facing a greater challenge in finding skilled managers than a year ago, even though the sector is still hollowed out from its pre-crisis peak.
Both bodies agree that if the skills shortage is not addressed, it could pose a real threat to the sustainability of the UK’s economic recovery.
