The quarterly Monster Jobs Confidence Index by job board Monster.co.uk and the Centre for Economics and Business Research (Cebr), reveals workers and job seekers confidence in the UK labour market has dropped between Q4 2018 and Q1 2019 and is now at its lowest level since Q4 2015. In Q1 2019, the Monster Jobs Confidence Index stood at 62%, down from 67% in Q4 2018.
What does the Index measure?
The Monster Jobs Confidence Index is a holistic way of assessing the UK labour market. It is the only index to assess how secure workers feel in the place of work, in terms of job security and earnings stability, and also how confident they feel in their ability to progress in their career. The Index combines two macroeconomic indicators (consumer and business confidence), ten labour market indicators (unemployment, job earnings security, productivity, social mobility, pay gaps and amount of apprenticeships), and four survey-based indicators (future employment confidence, career progression confidence, equality and political landscape).
Why has jobs confidence dropped?
The Monster Jobs Confidence Index now stands at 62%. Despite unemployment falling to its lowest level since the 1970s, job confidence is still falling due to a lack of quality jobs and concerns about job security.
A drop in business confidence (41 percentage points lower than a year ago) has had a large impact on this quarter’s index score, as well as levels of regional employment inequality, a drop in 32 percentage points.
A quarter of UK workers feel unconfident about their future career prospects
The Monster Jobs Confidence Index highlights how confident people feel about their job, including the likelihood of losing their job and their general employment situation over the next six months. Across the country, half of those asked said that they feel confident, however, a quarter are unconfident about their prospects, a slight increase from 23% in Q4 2018.
The index also measures how people feel about their job prospects and ability to progress over the next five years. In this quarter’s index, 42% said that they were confident, an increase from 38% in the previous report.
The UK’s current political situation and Brexit uncertainty, are both having an impact on levels of confidence amongst UK workers. Over a third (35%) of those asked said that the political landscape makes them feel unconfident about their current employment.
Job quality is impacting job security
The rise of the gig economy has led to a dramatic increase in the amount of insecure work. Indicators of job quality included in the Monster Jobs Confidence Index present a mixed picture of the UK’s current situation. Although wages are growing at a decent pace and unemployment is at its lowest for 40+ years, there are more workers who do not have job earnings security. This is reiterated in the survey-based indicators which suggest that many people are worried about the future of their employment.
This report highlights the reasons why it is important to consider job quality alongside quantity measures. These include impacts on personal lives, wellbeing, innovation and the NHS.
Confidence at its lowest for Welsh workers
Only 38% of workers in Wales are confident about their job in the next six months, with 34% saying they feel unconfident about what the future holds. Despite the unemployment rate in Wales being fairly robust at 4.4%, which is lower than in the North East, West Midlands and Yorkshire and the Humber- earnings growth has been very slow over the past two decades. Workers in Wales have one of the lowest rates of pay in the UK, with the median weekly pay standing at £422 in 2018.
In comparison, 52% of respondents who live in the South East, say they feel confident about their employment situation over the next six months.
Disparity in the unemployment rate between UK regions worsened in Q1 2019, to 3 percentage points, up from 2.5 in the previous quarter. The region with the highest unemployment rate was the North East at 5.4%, whilst the South West had just 2.4% unemployment; the lowest in the UK.
Educational differences having an impact on UK workers confidence
People who have received the highest levels of education are most likely to feel confident about their employment prospects over the next five years. Over half (54%) of workers with a postgraduate degree said that they were confident or very confident about their ability to progress in their careers over the next five years.
In comparison, workers whose highest qualification is at GCSE level or equivalent have very low levels of confidence, with only 35% saying they feel confident about long-term career prospects.
Although the number of people starting apprenticeships is increasing, those who have vocational qualifications or have completed apprenticeships are also lacking confidence in their future career prospects. 35% said that they feel unconfident about their future employment and ability to progress in the next five years.
Overall jobs confidence likely to continue falling throughout 2019
Although official employment figures are not expected to measure a rise in the unemployment rate for the rest of the year, it’s highly likely that jobs confidence is going to continue falling. A change in Prime Minister, combined with conversations about a general election, as well as continued uncertainty on the terms the UK will leave the EU on, will all cause concern for workers and business owners. This in turn will reduce levels of confidence in the employment market.
Derek Jenkins, General Manager UK & Ireland, Monster.co.uk, says,
“It’s really disconcerting to see that confidence is continuing to drop amongst UK workers. However, taking into account ongoing political turmoil in the UK and continued uncertainty around Brexit it is understandable.
“It is also important to take into account the quality of jobs we’re seeing in the UK and how this impacts job security. In recent years we’ve seen a shift away from traditional part-time roles and an increase in gigging work and zero hours contracts. Although this gives the impression that more people are in work, this type of work is not suitable for everyone and can leave workers feeling demotivated and uncertain about their futures.
“Like confidence, quality is a personal opinion and there are some groups in society, such as students and carers, who appreciate the flexibility. Employers, should therefore, identify the type of work that is best for a person’s situation as that will contribute to their sense of security and in turn, the confidence they have in their employment. For some that will be a full-time permanent job, for others it will be gigging.”