• Hiring confidence has slipped for a second consecutive month. We look at what that means for a UK economy reliant on a buoyant services sector.
• The UK’s largest human trafficking ring has been broken. Find out how the criminals used an unsuspecting recruitment agency to process its victims. And learn how to safeguard your own enterprise.
Hiring Confidence forecast suggests prolonged slowdown
Consultancy figures suggest falling expectations – but what is the underlying cause?
Hiring sentiment for the future is beginning to fall among Britain’s employers, according to at least one industry consultancy.
A study conducted by business advisory firm BDO LLP this week found that recruitment intentions had dropped in June – for the second month in a row.
The firm’s number-crunching considers multiple data points and forms them into an overall employment index rating.
The ongoing study considers: business hiring intentions; the availability of temporary and part-time labour in the jobs market; and the number of new vacancies being created. Any score above 100 shows positive hiring sentiment.
Recent BDO data found that its employment index had slipped to 112.82 in June. It represents an almost 2.3 point decline since January of this year.
Positive sentiment, but long-term concerns?
Taken by itself, the statistic appears relatively innocuous. It shows that sentiment remains firmly positive, and that the decline is small. However, some of the data which contributed to the recent BDO rating calculation might cause concern for recruiters.
First and foremost, productivity data showed a significant slump in output. The BDO recorded an output index rating of 97.24 – matching the previous low for the year. Output in manufacturing was singled out as the main source of the decline. The sector experienced its slowest output since December of 2016, at just 92.83.
The second reason for the low confidence rating? That there has been no indication that current trends will correct quickly. In fact, the BDO forecast a protracted slowdown, with productivity optimism for the next three to six months also falling.
In June, manufacturing optimism fell below the ‘positive’ benchmark, to 97.99 – the lowest it has been since January 2013.
Despite this, the Overall Optimism Index actually rose in June – if only by the smallest of margins. The 0.01 increase to 99.23 remains pessimistic, but was buoyed by a strong positive outlook in the services sector.
Data underlines the valuable role of services
The primary takeaway for agencies should be the crucial role that they play in the bigger picture of Britain’s growth fortunes. As a key facet of the services sector, recruitment’s sustained optimism is sustaining the wider economy during tough times.
This only underlines the concern which many will view the sudden fall in hiring outlook. Andrew Mair, Partner at BDO LLP apportioned the recent slowdown to Brexit. Stating his concerns about a no deal, he said:
“The glory years of rising UK employment figures could be coming to an end. While the numbers remain in positive territory, growth is slowing. The labour market has been resilient to the potential effects of Brexit, but months of negative sentiment has finally taken its toll.
“No deal is a very real and frightening possibility. It would be no surprise if this damages confidence, leading to further curtailment of the investment and hiring plans of British businesses.”
With the current brexit deadline set for October 31st, it is unlikely optimism will grow in next quarter’s figures. Whether hiring confidence returns may depend on the exit deal and timetable arranged by central government.
UK recruitment consultant jailed in human trafficking case
A Worcestershire-based agency was used as the unwitting front for an organised crime operation.
Recruitment news rarely enters the murky world of organised crime. But when it does, it usually provides invaluable insight into the way we work – and how criminals exploit the loopholes.
Last week, a court case ended in the imprisonment of eight people convicted of human trafficking offences. It was the largest human trafficking operation in British history. Perhaps the most disturbing aspect of the case was the revelation that victims had been processed and authorised for work by a legitimate recruitment agency.
Juliana Chodakowicz, 24, was considered a star consultant by her bosses at the unnamed Evesham recruitment firm. Her ability to source affordable staffing solutions for often challenging manual work was praised. However, the recruiter was using her employers’ business as a front. The court heard how she exploited her position to process trafficked individuals, and place them in positions that could earn income for the crime family.
Ms Chodakowicz was sentenced for five-and-a-half years last week.
Sophisticated Criminals Exploited Business Blindspots
The highly organised criminal gang is thought to have exploited more than 400 immigrant workers while it was operating – netting the participants millions in stolen wages and benefits.
The criminal gang, which operated from a family home in West Bromwich, would systematically target vulnerable job seekers in Poland.
The court heard how victims were driven by coach directly to the offenders’ private residence in the Midlands. While they had been promised earnings of up to £400, most were left with as little as £20 for themselves. Victims were housed in squalid conditions, with some victims having to wash in a nearby canal as their housing lacked proper plumbing.
By contrast, the court heard how the head of the operation, Mr Ignacy Brzezinski (52), lived in relative luxury, and drove a Bentley. Although the court case only considered £00,000 of misappropriated earnings, police believe the criminal gang profited by over £2 million in total.
The case illustrates a new generation of sophisticated organised criminal that is technologically-savvy, and aware of blind spots in business operations. It also exposes the dangers facing agencies that do not carry out stringent oversight and reporting.
Recruitment technology: a Solution
The case is a timely reminder of new concerns for business. Organisations are already expected to publish clear anti-slavery policies. But the nature of these crimes demonstrates that close supervision of personnel must also be a priority.
The growing concern among recruiters is why eBoss has developed a new set of reporting features for analytics and supervision. The new tools will not only assist with business performance, but also prevent the misuse of agency systems.
In a digital working environment, it is virtually impossible to collect all data manually. But the advantage is that automated data and reporting tools allow you to find the important details when you need them. eBoss databases will allow full oversight of consultants’ activities to safeguard recruitment firms against abuse and misuse of company systems..