So here we are nearly two years after I wrote Top 5 Recruitment Sectors to be in for next 5-10 years and unemployment was still rising across most of Europe and the UK economy flat-lining how things have changed for us.
Today the Eurozone is stagnating but the UK has enjoyed a solid eighteen months of growth.
Top 5 Sectors for the Next 5-10 Years Update
My views on the Top 5 Recruitment Sectors for the next 5-10 years remain unchanged and there is increasing evidence to reaffirm that these sectors remain the ones that will see the fastest grow:
- Information Technology
- Energy, Oil and Gas
- Emerging Technology application
Information Technology continues unabated and this year our blog: The Top 5 IT skills right now! highlighted the key growth areas. Engineering is now also recognised as a key grow area for the UK economy.
Energy demand has abated somewhat since 2013 mainly, due to a slow down in global growth, but this sector remains a volatile sector highly dependent on the oil price. Currently there is a lull but is anyone willing to bet on it staying this low across the medium to long term. So watch this space. What we are witnessing in this sector is a switch to renewables and this is a key growth sector for agencies here.
Finally emerging technology application is starting to impact all sectors and with the talk of 5G Mobile networks allowing people to download 10 HD movies in 10 seconds being launched in the next five years the grow in Hi-Tec applications is set to explode. Only this week the UK Government have given the go ahead for driver-less –cars in five cities across Britain. So watch this space.
Top 5 Sectors for 2015
So what about 2015, will they be all the same?
No 5 – Information Technology
Certainly I see no reduction in demand for Information Technology. In the past month as part of a Managing Client Meetings coaching day we visited an IT Software Development company in South Wales. The business is part of global network of development centres from the US, Switzerland, India and the UK. It was interesting and heartening to hear that the UK remains extremely competitive and what may surprise many is that the differential in development costs between the UK and India is non-existent. In fact when all things are considered the UK is the most cost-effective place for software development certainly for this client. This is not untypical and with IT still attracting large numbers of graduates, the future for the industry looks healthy but not without issues.
The continued drive towards mobilisation of business via smartphones and tablets, the push for businesses to harness the benefits of ‘big-data’ the continue trend to placing everything in the cloud and the drive for virtualization are making skills in all these skill-sets hard, if not impossible, to source in most regions.
Demand for 2015 looks strong.
No 4 – Marketing and Sales
With businesses looking to expand market share, drive into new sectors or leverage the explosion of niche digital markets, 2015 looks to be the year high calibre sales and marketing professionals totally disappear. In the IT services, digital marketing and recruitment spaces my clients inform me that this is already the situation. Rec-2-Rec companies have struggled for a while to find real hard hitters who can deliver good consistent billings. Only Recruitment businesses, which operate with autocratic management regimes seem unable to hold on to their top billers. The abundance of recruitment sectors, which are now experiencing good growth means even average billers are now earning healthy incomes and not to wish to move.
So MD’s if you are losing staff take a look at yourselves first! Your issues may be closer to home than you think.
In sectors as diverse as construction, digital marketing, IT services and capital equipment top billers are not looking to move and businesses are increasingly turning to the ‘grow-your-own’ strategy. At Recruitment Training Group and Selling Success we are experiencing a 300% increase in the clients engaging us to design, build and deliver Graduate/New Sales Training Academies. Even if you don’t use ourselves this is a must for businesses seeking to deliver sustained sales growth over the next 2-3 years. Call us if you want to chat (07552 555858).
No 3 Construction
The phenomenal growth this sector has seen over the last eighteen months means its hardly surprising that we are seeing a slight decline in its progression. Like Information Technology I see this as a healthy sector to be in during 2015 as the demand for new houses continues unabated.
This year has seen huge shortages develop as reported by David Noble of Chartered Institute of Purchasing and Supply, “An encouraging 15 months of sustained employment growth – the longest since 2006-2008 – is revealing a major skills shortage in the sector.”
Irrespective of who wins next years general election there is a massive shortfall in the level of houses we are building currently compared to the demand. The shortfall is currently projected to be 40-50,000 completed dwellings in 2015 with an overall construction sector projected growth rate of 5.3%. With several key capital projects announced recently by the government and the investment being made in roads the sector looks set for a period of sustained growth.
No 2 Financial Services
Whatever your views on bankers and financiers and lets face it we all have pretty strong ones; a vibrant financial services sector is key to sustained growth for the UK economy.
Last month a study released by the CBI and PwC indicated that the finance sector had returned to pre-recession levels. As reported in the Financial Times in October 2014, Kevin Burrowes, UK financial services leader at PwC, highlighted an rising focus on new products and services and ‘technology-enabled growth’.
2015 has seen the return to healthier profit of many of our financial institutions. Our banks have performed well in recent years and they were noticeably absent from the European Banking Authority s list of failing banks recently.
Recruitment companies in the financial services sector are all talking big numbers for 2015 and I believe there is renewed optimism in this sector.
Sectors Worth Mentioning
Of all the sectors not mentioned here the one that could make a real surge in 2015 and upset this prediction is Healthcare. The shortages in this sector are well headlined. Doctors, Nurses and ancillary staff are all in short supply. Overall spending in this sector is either the same or growing not just within the NHS but private sector too. The demand for health workers with frontline skills remains high and once again we have insufficient numbers of people training to be doctors, nurses and clinicians entering the workplace.
In fact all the talk is for more support needed for the Care Sector alone. There is one factor which could change all this and that is government spending. The current provision of care by the NHS and local authorities is failing and the costs are spiralling. This is an issue that the next government will need to address over the next 2-3 years for the sector to remain viable. My contacts within the Dept. of Health and NHS England all tell me a big change is coming irrespective of which party comes into government after next May. My reason for omitting it from the 2015 Top 5 is that I see the changes will come too late to have an impact in recruitment sector for 2015 but expect to be discussing this again next year when we look forward to 2016.
No 1 Engineering
The sector I see most likely to grow the fastest in 2015 is engineering. The estimated annual shortfall of engineering skills in the UK is currently running at over 81,000 people. In addition according to recent studies those of us over the age of 50, who will be looking to retire in the next 10-20 years represent 20% of the UK workforce so this problem is only going to get worse.
A recent study by the Institution of Engineering and technology discovered organisations employing engineering skills reported:
- Six out of 10 engineering employers fear that a growing shortage of engineers will threaten their business in the UK, research has found.
- 76 per cent of employers reported problems with recruiting senior engineers with five to 10 years’ experience
- 43 per cent of employers were not taking any specific action to improve workplace diversity
- It’s estimated that the UK requires 87,000 engineers every year for the next 10 years to meet projected demand.
Only last month the entrepreneur and industrialist Sir James Dyson also highlighted the skills gap in this sector and all the data around future demand.
The CBI has also reported that STEM – science, technology, engineering and mathematics – skills shortages are widespread, with 43 per cent of employers currently having difficulty recruiting staff. That rises to 52 per cent of employers expecting difficulty in the next three years.
The Royal Academy of Engineering has also published a study saying Britain’s industry will need 100,000 new graduates in STEM subjects and a further 60,000 technicians and apprentices every year until 2020, merely to maintain current employment numbers. At present Britain produces only 12,000 engineering graduates a year. The UK also has the lowest number of female engineers in the whole of Europe at 6% of the workforce.
The evidence is overwhelming and when you get into the detail the demand is increasing too. By way of an example the Institution for Engineering and Technology indicated that 41% of the firms they surveyed planned to recruit in 2015 up 5% on the previous year.
With recent figures showing that the UK manufacturing sector is growing at its fastest rate for many years the demand shows now signs of abating just yet.
Whilst I am pleased to see the opportunities for our clients to grow their businesses and delighted by the many thousands of views my annual blog receives on this topic every year, I can’t help fearing that our government is failing both our young people and us.
I am not in favour of a ‘centrally-controlled’ UK economy where the places are controlled but surely the existing system is neither working for students, parents or employers. There appears no correlation between the number of university places to study a subject and the projected number of individuals we as an economy require.
Surely we need to run more ‘STEM’ type degrees and fewer ‘Media Studies’, ‘Film Studies’, ‘Sports Science’ degree places. I am not saying that these degrees are worthless because they are not. It is just that UK Plc requires fewer of them than we are producing graduates in.
I have two children studying degrees and this has been a key discussion for us as a family. What I have told them is it is ultimately their decision, but it is a £50,000 decision so think carefully.
So parents if you are interested to know here is 2014’s Top 20 Degrees most likely to leave you on jobseekers!.
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We would like to take this opportunity of wishing you a happy, successful and prosperous 2015.