LinkedIn Workforce Report | United Kingdom | February 2018
Over 24 million people in the UK have LinkedIn profiles. This means that we can see where 24 million members of the UK workforce are based, what companies they work for, and when they change jobs. We anonymise and aggregate this data to create unique insights into workforce trends.
The LinkedIn Workforce Report is a monthly report looking at hiring and professional migration trends in the UK, and this month’s report looks at the latest data from January 2018. This is our fourth Workforce Report for the UK, and it also takes a comparative look at both data from January 2018 as well as that from the previous 12 months to benchmark our findings and identify trends.
LinkedIn’s vision is to create economic opportunity for every worker in the global workforce. We hope that the Workforce Report will be useful to our members, allowing you to better navigate your career, and to businesses and policy makers, who will be able use our insights to better inform their decisions on talent, migration, and employment.
UK hiring enjoyed a stronger start to 2018 compared with December 2017. The seasonally adjusted (S.A.) month on month (MoM) Hiring Rate grew in January by 5.3%. This recovery ends a three-month downturn that had indicated slowing labour market activity as 2017 drew to a close. However, while the year on year (YoY) National Hiring Rate was up by 5.4% on January 2017, this was the lowest increase by this measure since we started this report in November 2017. The rate of growth in the YoY National Hiring Rate has been slowing since October.
The Hiring Rate grew in nine out of the 12 UK regions and nations. A significant rise in S.A. MoM hiring in January drove average growth across the country to 10.6%, and this increase was most pronounced in Northern Ireland (up MoM by 26%), Yorkshire and the Humber, Wales, the North East and the East and West Midlands.
London and the South East, the best performing regions in December, both failed to grow MoM in January. Scotland also registered 0% S.A. MoM change, reflecting in part a significant fall in hiring in the energy sector. Yorkshire and the Humber outperformed the rest of the country in terms of its YoY Hiring Rate, up 13% on January 2017, with London and the South East again falling behind on 3%.
Hiring in most sectors grew. The S.A. MoM Hiring Rate increased in 14 out the 20 reported sectors in January, with the largest falls in Hardware and Networking and Energy and Mining (down 19% and 15%, respectively). Construction hiring has picked up, with a S.A. MoM increase in January of 22% ending three sluggish months. Hiring in the financial sector is recovering, up 8.3% MoM in January and also showing a healthy 14% increase YoY. Public sector employment is also rebounding, with MoM hiring increases in Healthcare, Public Administration and Education appearing to confirm predictions by hiring managers last autumn of an expansion in the public workforce. Hardware and Networking and Design were the only two sectors to experience a YoY decline in the hiring rate on January 2017.
The UK continues to be an attractive destination for international workers, with nine out of the 12 UK regions and nations gaining more talent from overseas than they lost. Only Northern Ireland, the North East and Yorkshire and the Humber continue to see a net loss of talent abroad. London is still the most attractive destination for international and domestic migration, although Scotland overtakes it in terms of the proportion of its new arrivals coming from abroad. London, the South West and the North West continue to be the only three UK regions that are net recipients of combined domestic and international migration. However, net inflows of international talent have been slowing since November in most regions of the UK, especially London and the South East.
The Hiring Rate
The seasonally-adjusted MoM Hiring Rate for January was up 5.3% on December 2017, reversing a downward trend since September that saw a 4.2% decline in December.
Year on Year (YoY), hiring is up 5.4% on January 2017, a figure similar to last year that reflects the fact that, while this is the busiest period for hiring, the UK is not seeing a significant increase in people taking up new jobs over last year. The National Hiring Rate of 1.31 was 5.4% higher in January 2018 versus January 2017.
Regional Hiring Rates
The S.A. change in the Hiring Rate was positive MoM in 9 of the UK’s 12 nations and regions, with an average increase across the country of 10.6% reversing December’s decline. However, hiring is unchanged in London, the South East and Scotland, which have previously outperformed the average. The English regions displayed MoM growth rates ranging from 4% in the South West to 16% in Yorkshire and the Humber, which also recorded the highest YoY growth in the UK on January 2017 at 13%. Hiring in Northern Ireland achieved the highest MoM growth in the country (26%) and also grew 10% YoY.
Notable regional activity this month includes:
There was no growth in the S.A. Hiring Rate in London MoM in January, even though it had been the only region to experience growth in December, albeit of just 1%. The capital has seen little change in its hiring rate since November and its 3% YoY growth was, alongside the South East and North East, the lowest in the country. Since January 2017 Finance has restored its position as the strongest sector for hiring in London, displacing Software and IT.
South East – As with London, the South East recorded no change in the S.A. MoM Hiring Rate in January versus December. The region’s YoY Hiring Rate was also up only by a modest 3%. Software and IT services was the strongest sector for new hires.
Northern Ireland – Growth of 26% in the the S.A. MoM Hiring Rate in Northern Ireland in January exceeded that of any other UK region or nation, and this part of the country also performed well YoY with growth of 10%, just behind Scotland. Software and IT was the top sector for new hires.
Yorkshire and the Humber – Yorkshire and the Humber achieved 16% growth in the S.A. MoM Hiring Rate in January, the highest of any English region and well above national average growth. The region also performed well YoY with a 13% increase in the Hiring Rate compared to January 2017.
Wales – Wales also performed well in January, with the S.A. MoM Hiring Rate up by an above average 16% versus December. However, growth in the YoY Hiring Rate of 5% is below the 7% national average. Manufacturing was the top source of new hires.
The East Midlands – The East Midlands recorded a healthy increase in the S.A. MoM Hiring Rate in January (up 15%), on a par with the North East. The YoY Hiring Rate in the East Midlands was also a positive 7%, with hiring in Manufacturing leading the way.
The North East - In the North East, the S.A. MoM Hiring Rate was also up 15% versus December, above normal expectations for this time of year. However, the YoY Hiring Rate was up 3% on January 2017, which is low compared to the East Midlands and Yorkshire and the Humber. Manufacturing was again the top sector for new hires.
The West Midlands – In January the West Midlands also recorded above average growth in the S.A. MoM Hiring Rate (up 14% on December), and growth of 12% on 2017 in its YoY Hiring Rate was the second highest in the UK. Manufacturing was a frontrunner for new hires.
Scotland – There was no growth in the S.A. MoM Hiring Rate in Scotland in January, reflecting in part a significant fall in hiring in the Energy sector. Growth in Scotland’s YoY Hiring Rate of 11% in January was slow compared with December, when it had seen the highest YoY rate of any region or nation in the UK (up 23%). Finance was the top sector for new hires.
The North West – In the North West the hiring picture was also positive in January, with growth in the S.A. MoM Hiring Rate of 13%, and YoY growth was also up by 7% on 2017.
South West - The S.A. MoM Hiring Rate was up 4% versus December, and the YoY Hiring Rate was up 5% on January 2017.
The East of England – The S.A. MoM Hiring Rate was up 8% in January, and the YoY Hiring Rate grew by 5% on January 2017.
Sector Hiring Rates
A deep dive into the individual Hiring Rates for different sectors of the economy can give us a better understanding of the hiring changes that have been taking place.
Energy and Mining - Energy and Mining recorded a significant fall in the S.A. MoM Hiring Rate in January (down 15%), reversing its fortunes in December when it had recorded the strongest growth of any sector (12% MoM). The YoY Hiring Rate in Energy and Mining in January, however, was at the upper end of growth (9%) and above the 7% average increase among the main hiring sectors.
Hardware and Networking - Hiring in the Hardware and Networking sector recorded the highest decline in the S.A. MoM Hiring Rate of any sector (down 19%), and YoY the Hiring Rate fell 2% in January, continuing a sluggish period.
Finance - S.A. hiring in Finance reversed a trend of MoM declines until December by growing 8% MoM in January. Finance also grew 14% YoY on January 2017, retaining its top spot in London as the strongest sector for new hires.
Construction - Construction hiring has begun to recover after three slow months, with the S.A. MoM Hiring Rate up an impressive 22% in January, taking the sector back to where it was in October. The YoY Hiring Rate was also up 9% on January 2017.
Manufacturing – Manufacturing is one of the business sectors that have been pushing up the Hiring Rate nationally, with S.A. MoM hiring up 15% in January, and growth of 6% YoY on 2017.
Real Estate – Real Estate achieved the highest growth in S.A. MoM Hiring Rate in January of any of the main sectors (up 29%), reversing a consistent decline since September, and it also grew 11% YoY.
Healthcare – Healthcare was in the vanguard of a revival of hiring in the public sector, which may reflect the anticipated expansion in the public workforce predicted by hiring managers last autumn. It achieved an above-average increase in the S.A. MoM Hiring Rate in January of 17%. YoY the Hiring Rate in Healthcare was up 8% on 2017.
Education - The S.A. MoM Hiring Rate in Education was up 14% in January, also reflecting the revival in public sector fortunes, and YoY the Hiring Rate was up 6% on 2017.
Public Administration - The Public Administration S.A. MoM Hiring Rate rose 14% in January versus December, and the YoY Hiring Rate was up 8%.
Consumer Goods - There has been healthy growth in hiring in the Consumer Goods sector, with a 14% increase in the S.A. MoM Hiring Rate in January, and 8% growth YoY.
Nonprofit - The Nonprofit sector is also showing signs of a pick up, with an increase in the S.A. MoM Hiring Rate of 12% in January. The sector recorded the highest growth of any sector in the YoY Hiring Rate, up 15% on January 2017.
Transportation and Logistics – Growth of the S.A. MoM Hiring Rate in the Transportation and Logistics sector was 15% in January, more than double the 7% average growth among the main hiring sectors. YoY the Hiring Rate was up 6% on January 2017.
Retail – Hiring in the Retail sector picked up in January with an increase in the S.A. MoM Hiring Rate of 8%, reversing a fall of 14% in December. There was 5% YoY growth on January 2017.
Media and Communications – Steady growth in Media and Comms in the final two months of last year ground to a halt in January, when the S.A. MoM Hiring Rate fell 2%. The sector also grew by only 4% YoY versus January 2017.
Corporate Services – Corporate Services has reversed the decline it experienced in December, with growth in the S.A. MoM Hiring Rate in January of 7%. YoY the Hiring Rate was up 9% on 2017.
Recreation and Travel - In the Recreation and Travel sector, the S.A. MoM Hiring Rate was up 11% in January, again reversing a negative picture in December. YoY the Hiring Rate was up 8% on January 2017.
Legal – There are signs that slowing growth in the Legal sector may be coming to an end, with an increase of 2% in the S.A. MoM Hiring Rate in January reversing a hefty 14% fall in December. YoY the Hiring Rate was up 2% on January 2017.
Software and IT Services – The picture for Software and IT Services has turned negative, with a 3% fall in the S.A. MoM Hiring Rate in January reversing modest growth in December. YoY the Hiring Rate rose by just 2%.
Entertainment – Hiring in the Entertainment sector performed poorly in January, with the S.A. MoM Hiring Rate down 2%. YoY this sector is also underperforming, with an increase in the Hiring Rate in January of just 1% on 2017.
Design - The Design sector is in the doldrums, with a decline of 4% in the S.A. MoM Hiring Rate in January, and a fall YoY in the Hiring Rate of 1% on January 2017.
London remains by far the most attractive destination for international arrivals, attracting almost double that of its nearest rival Scotland, but Scotland continues to attract a higher proportion of its new arrivals from abroad.
Nine out of the 12 regions and nations are net attractors of international talent, with Northern Ireland, the North East and Yorkshire and the Humber continuing to be the only regions that failed to draw more international workers than the workers they lost to overseas in the past year.
In January, the net movement of workers both within the UK and internationally slowed versus December in seven regions (the North East, East Midlands, South East, Yorkshire and the Humber, North West, South West and London) and stayed the same elsewhere. The net inflow of international talent has slowed since November in eight regions and nations of the UK, especially in London and the South East.
Outward migration from the UK’s regions
London, the East Midlands, and the South East continue to be the regions from which members are most likely to leave and move to other UK regions or other countries.
Of these three regions, only London saw a majority of people who were leaving heading abroad. Similarly, the majority of those leaving Northern Ireland and Scotland also head abroad.
Inward migration to the UK’s regions
London, the East Midlands, and the South East also continue to be the regions gaining the most members from other UK regions or other countries.
London, Scotland and Northern Ireland all saw the majority of inbound members arrive from another country, while every other UK region welcomes most of their arrivals from another part of the UK.
Net flows to UK regions
London, the South West and the North West continue to be net recipients of combined domestic and international migration, while the North East continues to see the biggest net outflow.
For net domestic migration, London continues to be the biggest draw and the South East and North East remain the regions with most people leaving.
From the perspective of international migration, the UK continues to be an attractive destination, with nine out of the 12 nations and regions net gainers of international talent. Northern Ireland, the North East and Yorkshire and the Humber continue to lose more workers to other countries than they gain. The flow of international talent to London has slowed since November.