A body has predicted the unemployment rate will jump up due to the spread of COVID-19, which is bad news for the UK but could ease the “war for talent”.
The Office for Budget Responsibility (OBR) has stated that if the lockdown lasts for three months, unemployment will rise from 3.9 per cent to 10 per cent.
The OBR state that unemployment may rise from 2.1 million to 3.4 million by the end of June.
It stated that the sharp unemployment rise will occur this month, when it will reach 10 per cent, it is then predicted to decrease to 7.3 per cent by the end of 2020.
The body believes the unemployment rate will remain high until 2023.
This is a huge difference from December 2019, when the Office for National Statistics (ONS) said that UK unemployment was at its lowest level since January 1975 in the three months up to October 2019. The ONS reported that the unemployment figure fell by 13,000 to 1.281 million.
At the time, Matt Weston, managing director, Robert Half UK said:
The UK labour market has been characterised by a competitive hiring environment over the course of 2019, with today’s statistics highlighting that employment rates remain at record levels. As such, we expect the buyer’s market – where in-demand professionals are often receiving multiple offers – to continue into 2020.
This ‘war for talent’ places the onus on employers to review their talent attraction and retention strategies. Skilled professionals today are looking for more than just a competitive remuneration package – flexibility, development opportunities and company culture are increasingly valued when reviewing an offer.
It’s also worth noting that professionals are forming their opinions on the role from the very start of the job application process, through to the interview process and offer stage. Therefore, employers who are able to create a positive recruitment experience – as well as an attractive offer – will be able to hire the industry’s leading talent.
This rise in unemployment will potentially give recruiters a bigger pool of candidates and reduce the “war for talent”.