What’s Driving the Candidate Shortage? And What Can You Do About it?

If you’re hiring today, you’re not alone. Nearly 3 in 4 charities are. Vacancies are booming, but the numbers applying to them is down across most industries. Data from CharityJob mirrors this. Average clicks on apply rose as high as 109 per job in May 2020. But that number fell to just 25 in June. Whilst this measure is imperfect, the change is worth investigating. What is behind the candidate shortage? Where are all the applicants? There is no single answer but low unemployment, uncertainty over charities’ finances, Brexit, and the pandemic all play a part.

Vacancies booming

Across the UK, vacancies are booming, but employers are struggling to fill them. In the first week of August there were 1.7 million live job adverts in the UK. There are more live vacancies in the UK than ever before. On top of that, employment is at its highest level this year, with the increase in June the highest (month-on-month) on record. Vacancies in almost every UK sector are above their pre-pandemic levels. Nearly 70% of all employers are planning to recruit, a figure even higher among charities (72%).

Many charities may recognise the words of Kate Shoesmith, Deputy chief executive of the Recruitment & Employment Confederation (REC):

“Recruiters are working flat out to help find the best people but there are shortages of workers in almost every sector across the country.”

Bottleneck or Brexit?

Despite the record vacancies, the number of people applying to jobs is low. There are several factors behind this: people are staying in their jobs to avoid changing during uncertain times, Brexit, the pandemic and low unemployment. For some sectors starter pay is booming, though not others, and there has been no rise in salaries on CharityJob.

The issue could be simply a bottleneck, as things take time to return to normal. This is especially the case when lots of employers are all looking to hire. There may be many applicants, but not all are suitable – not everyone will have the right skills or be in the right location. The labour market has been likened to people returning to their desks after a fire alarm – we can’t all fit through the doors at once. Others have used the image of a ketchup bottle – shaking and banging it doesn’t get the sauce out straight away. The labour market has been significantly becalmed during the pandemic as many charities and applicants sit tight to see what happens (excluding those sadly forced to change their circumstances). Now that so many charities are trying to hire again after a long period of hiring freezes, it may take time.There are a record number of charity jobs but a candidate shortage

Fewer workers

There is talk of a ‘great resignation’, but it hasn’t happened yet. Overall, there are fewer workers to apply to current vacancies. Many have left the labour market for various reasons, becoming “inactive” by entering or staying in education, unable to work through illness, or have given up looking for work. Brexit and the pandemic mean that there are fewer foreign workers than before – about 900,000 people may have left the UK due to Brexit (not all workers). Others can’t come over due to immigration and covid-related restrictions. For some, looking for a job is the last thing they want to do after everything they have been through over the last 18 months. Compared to seeing family, friends or having a holiday, getting a new job might not be a priority.

Furlough is a contributary factor for now, with nearly two million still on the scheme. However, around 660,000 jobs are unlikely to survive the withdrawal of the scheme. This could result in an increase in job seekers. Around 9,000 charities used furlough at the end of 2020.

Wait and see during uncertain times

Some are waiting to see how the economy recovers. A survey of over 2,000 people in the UK and Ireland shows that more than one in three are looking at quitting in the next six to 12 months, or once the economy is stronger. With so much uncertainty, many people who would otherwise look for jobs are waiting to see how things play out.

Some potential applicants will read news that many charities are facing uncertain futures and think twice about moving jobs. Others may be waiting on their return to the office and may give their current job a chance for a month or two to see before they start looking for something new.

person talking over Zoom

Remote working

The impact of remote working cannot be discounted as well. Four out of five charity employees want to work remotely more often than before the pandemic. Half want to mainly work from home, but one in three prefer not to. Across all sectors, around half of employees could quit if denied the flexibility they want, especially as over 40% feel they are more productive working remotely than in an office. While around 5% of all job adverts are for remote working, on CharityJob the figure is closer to 20%. And these jobs average around twice as many clicks on apply as non-remote jobs. This implies charities which offer flexible or remote working will be better placed to find the people they need.

Charity sector trends

Vacancies in the charity sector are above the levels they hit before the pandemic. Taking data from the ONS, charity sector vacancies across late June and early July were almost 20% above February 2020.

Graph 1Graph showing that charity vacancies are above pre-pandemic levels but there is a candidate shortageSource: ONS/Adzuna

We see a similar phenomenon looking at CharityJob’s own vacancy data. There have never been more jobs on CharityJob than there are now. The numbers are over a third above the pre-pandemic level of February 2020.

Graph 2Graph showing that vacancies on CharityJob are above pre-pandemic levels but there is a candidate shortageSource: Internal data

Why are there so many vacancies?

It’s hard to say for sure. Charity shops are booming, so some money is coming in after an incredibly difficult year. But charities are still facing a “fundraising black hole”. Some fear the sector could be decimated by the pandemic.

The Covid-19 Voluntary Sector Impact Barometer gives some clues. Reassuringly, more charities expected their finances to improve than get worse (23% vs. 20%). In fact, since Spring 2021, more charities have expected their finances to get better rather than worse (see page 6 of the latest dashboard). Perhaps relatedly, almost half of charities (47%) kept their paid workforce at the same level. Nearly 1 in 5 (19%) increased their paid workforce, while less than 1 in 10 (9%) decreased it.

This increase may be because 3 in 5 (57%) reported an increased demand for services over the last month, half (47%) saw an increase in their range of services since the beginning of the pandemic, and 2 in 3 (68%) expect an increase in demand for their services over the next month.

What can charities do to improve their hiring prospects?

There are many steps charities can take to improve their chances of successfully recruiting. They may need to be a bit more open to training someone up rather than expecting the finished article and embracing flexible working. While training budgets might have taken a hit recently, charities should be well placed to offer flexibility to candidates in order to help them accommodate caring responsibilities or disability. See our recruiter and diversity guides for more tips.

Tags: charity recruitment, charity sector, charity sector recruitment, hiring process, job market

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Martin Rogers