Is Technology on the up again?
As we enter the final quarter of the year, for many people, 2023 has been challenging in a way not seen for several years. Job flow has slowed down, and as a result, for recruiters, revenues have dropped too. In previous posts we have touched on, how vacancies have dropped year on year, equally what is interesting when looking at 2023, is the variance by sector. For some markets, there should now be signs of optimism, where for others, Q3 saw the lowest job totals posted in the year to date.
Therefore starting with Financial Services, we can see that in terms of the annualised total, the industry made up 27% of the total vacancies in London, equally in Q3 specifically it was under 25% and just as importantly, the last business quarter saw the lowest totals overall of the year to date.
The slump in the technology sector this year has meant that Real Estate has become the second-largest industry for jobs overall in London, and Q3 vacancies were nearly at the level seen in Q2. Equally, there are signs that the technology sector is bouncing back. With over 17% share of the Q3 London job flow, compared to an annual average of 15.7%, the signs are positive.
In contrast, Professional Services is still slumping, with Q3 being the lowest quarter for jobs. Not just that, the share of jobs in Professional Services has dipped below 10% for the first time this year. Anecdotally, there are those who say that the Firms across Accountancy, Consulting, and Law may have over-hired in 2022 leading to the slowdown this year.
Finally, with Consumer Goods & Services, this has been holding up better, with Q3 outperforming Q2. Equally, the share of jobs in Q3 was exactly the annual average. (9.3%)
With that, forecasting is a dangerous game, but looking ahead, which sectors do we think will perform best in the coming months?
- Our belief is that the Technology industry should continue on an upward path and could well exceed the Q1 total. Especially when one compares the 2022 totals to 2023, volumes are down 67%. This will rebound and we would argue, is already starting to. Last year the Technology industry made up 28% of all jobs in London, this year, 15.7%. Such is the stark drop, even if the share was to rise back to 20%+, this would make Q4 a record period.
- We would also expect a pick up within Consumer Goods & Services. With an election a year away, the Government will be doing what it can, to stimulate consumer spending. Interest rates have already topped out, salaries are rising faster than inflation and for the Conservatives to have any chance of winning, the mood has to be positive…
- In terms of the smaller sectors, we would also recommend keeping an eye on Healthcare, Defence & Energy. Whilst these are not big sectors in the London economy, these are the three outperforming last year in terms of total vacancies.
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The data referenced above has been sourced from Vacancy Analytics, a cutting-edge Business Intelligence tool that tracks recruitment industry trends and identifies emerging hotspots. With 17 years of experience, we have a deep understanding of market activities in the UK and globally.
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