UK Salaries Fall During Cost Of Living Crisis

Data collected from research in to the effect of falling salaries in the UK during a Cost Of Living crisis has shown that more and more employers are feeling the pinch during great times of uncertainty with regard to finances. Salaries have fallen in many jobs through out the labour market which is adding to the effect of the Cost Of Living Crisis. As the prices of many every day essentials rises in shops and from various companies, the general public will be struggling to survive as they won't be able to afford the items that they regularly buy due to the higher costs of raw materials etc. The findings come from research conducted by the Association Of Professional Staffing Companies.

The data - provided by the global leader in software for the staffing industry, Bullhorn – revealed an expected seasonal decline in hiring towards the end of last year. Permanent jobs dropped 15% and contract vacancies fell 22% between December 2021 and December 2022.

Although this decline is to be expected, it is the fall in remuneration which paints a more concerning picture at a time when skills shortages are rife. According to APSCo's data, average permanent salaries also fell in December 2022, down 6% when compared to the same period in 2021.

The Office for National Statistics (ONS) says that private sector pay grew 6.9% between August and October 2022 while public sector pay grew 2.7%, and that this was among the largest differences ever seen between the two.

The amount of pay people receive is not keeping up with the ever increasing rate of inflation which means the cost of goods and services around the country is more than the amount of money people have to spend. This is very unfair for many people in society as the amount of money people will have will have dropped during the Covid 19 pandemic and may take a lot longer to return to the original amount which they receive

Due to the lack of people who were spending money during the pandemic, it will mean businesses around the country will have a shortage in the amount of revenue they have coming in. This means that they will not be able to afford to pay their employees as much as they did and people will have to resort to applying for state benefits. These can take time to process so people may not have the correct funds they need at the right time.

The fall in the amount of pay people receive to do their jobs indicates that there is great market uncertainty which will result in many stock markets around the world falling due to lack of confidence in different sectors. Staff across the UK are facing a cost of living crisis at the moment which is causing great concern for the majority of households. Companies around the UK need to look in to wider remuneration packages to help attract and keep more highly skilled resources. This will help to ensure that the company survives during these uncertain times and the different employees around the country will be able to have access to the funds they need to survive their every day lives.

Ann Swain, Global CEO of APSCo comments:

"December has long been a quieter month for recruitment activity. However, while there has certainly been a decline in hiring noted, the fall in average permanent salaries paints a more concerning picture. There is still significant pressure on the labour market, particularly for highly skilled professionals. Businesses and recruiters alike shouldn't fall into the trap of believing the labour market has swung back in favour of the employer just yet. The power is still very much in the hands of the candidates, and without appropriate remuneration packages in place, access to crucial resources will become increasingly limited for firms."