Employer Branding: The Unspoken Hero in Today’s Shrinking UK Labour Market
With UK vacancies plummeting and economic inactivity rising, now is the time to sharpen your employer brand—or watch as competitors snap up the talent you sorely need.
The Reality Check You Didn’t See Coming
When vacancies are dropping like leaves in autumn and economic inactivity is on the rise, one thing is clear: the labour market is changing, fast. But here’s the twist—your biggest competitive advantage isn't just in wages or job perks. It’s in how you tell your story. Welcome to the age of employer branding. If you're still playing catch-up, now would be a good time to put the pedal to the metal.
Why You’re Feeling the Talent Pinch
The latest UK labour market statistics reveal a troubling trend. As economic inactivity hits 9.3 million—its highest level since 1993—and with a staggering 857,000 job vacancies own 143,000 from last year—it’s clear that the talent pool is rapidly shrinking. Unemployment may be hovering at a low 4.1%, but don’t get too comfortable. The unemployment rate is expected to rise to 4.5% by the end of 2024. In other words, the competition for top talent is about to heat up.
Worse still, the rising number of 82,000 redundancies between May and July 2024 suggests that businesses failing to adapt are already losing employees. Add to this the fact that 30% of economic inactivity is due to long-term sickness, and businesses are feeling the squeeze. Simply put, recruitment is becoming a battlefield, and the usual weapons—higher pay, shiny benefits—aren’t enough anymore.
So, what’s left in the armoury? Employer branding.
How Employer Branding Became Your Secret Weapon
Let’s face it: today’s talent market is as complex as British weather—unpredictable at best. As the labour market tightens and top talent becomes increasingly elusive, it’s companies with a clear and compelling employer brand that will thrive. According to the data, while unemployment remains low (for now), there’s no denying the rising trend in economic inactivity. And with economic inactivity numbers showing no signs of retreat, the labour pool is not just shrinking—it’s transforming.
This is where employer branding comes in. It isn’t just about plastering feel-good messages on your careers page; it’s about creating an authentic narrative that attracts candidates who resonate with your values and mission.
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Authenticity: More Than Just a Buzzword
Let’s be honest—any brand can slap a “We Care” banner on their careers site. But does your employer brand actually reflect reality? The data is clear: 9.3 million people are economically inactive, with long-term illness driving the highest level of inactivity since records began. Candidates are scrutinising how much you genuinely value well-being and flexibility, and transparency is king here.
The hard truth is; if you’re spinning fairy tales, top talent will find the next best (authentic) offer before you can say “mission statement.” Companies that communicate their commitment to a healthy work-life balance and can show genuine care for employee well-being will not only attract talent but also retain it.
The War for Talent Just Got Real
We all know the labour market is loosening, but don’t be fooled—competition for skilled candidates is only intensifying. Vacancies may be falling, but the talent market is tighter than ever. Today’s valuable job seekers want more than a payslip—they’re looking for alignment with their values and desires. And here’s the kicker: with 857,000 vacancies still out there, companies that aren’t actively investing in their employer brand are simply making it easier for their rivals to scoop up the best talent.
And it’s about to get tougher. With the unemployment rate forecasted to rise to 4.5% by the end of 2024, more businesses will be fishing in a shrinking talent pool. If your employer brand isn’t front and centre, you’re not just behind—you’re invisible.
Fail to adapt, and your dream hires will be sipping coffee at your competitor’s HQ faster than you can say "recruitment strategy."
The Flexibility Factor
If your employer brand doesn’t shout about things like inclusivity and flexibility, you’re probably already lagging. The pandemic shifted the workforce landscape permanently, and the numbers back it up. The number of people economically inactive due to long-term sickness reached its highest point since records began in 1993. This means that flexibility isn’t a buzzword anymore—it’s a non-negotiable.
Candidates today aren’t just seeking high paychecks—they’re seeking work environments that offer genuine flexibility, especially when it comes to balancing health and personal commitments. Companies that showcase their commitment to this type of employee well-being, inclusivity, and flexibility will always have an edge in attracting more diverse, top-tier talent.
And it’s not just about attracting new talent; it’s about retaining your current workforce too. With 82,000 redundancies in just three months, stretched companies that are not prioritizing flexibility and well-being are at risk of losing even more employees to businesses that are.
Trust: Your New Recruitment Currency
Good employer branding is all rooted trust. With the number of economically inactive individuals on the rise, a trustworthy brand that promises and delivers on flexibility, inclusivity, and well-being is like a cheat code for attracting top talent. And in a shrinking labour market, that trust will regularly be the deciding factor between you and your competitors.
Building trust doesn’t happen overnight. It’s about consistent, transparent communication, genuine efforts to support employees, and a willingness to walk the walk when it comes to flexibility and inclusion. But those who build trust early will reap the rewards, as competition for talent intensifies.
But Isn’t Employer Branding Just Fluff?
"Surely, now’s not the time to invest in employer branding," some might say. The economic instability and rising costs make it tempting to sideline branding efforts. But here’s the reality: in the long run, businesses without a clear employer brand will pay far more in time, effort, and recruitment costs. With the unemployment rate expected to rise and the pool of talent shrinking, now is not the time to sit back.
The numbers are crystal clear: 9.3 million inactive workers, 857,000 vacancies, and 82,000 redundancies. It’s undeniable that the job market is shifting in a way that can’t be ignored. A strong employer brand leads to lower turnover, meaning fewer headaches and more time to focus on what really matters—stability and growth.
Your 4-Step Plan to Stand Out (and Hire Smarter)
Want to avoid becoming just another job ad in the pile? Here’s where to start:
- Audit Your Employer Brand: Is it aligned with the true strengths of your employment experience, or just another attempt at corporate speak? Be honest. Look at your website, social media, and employee reviews. Are they all telling the same story—and is that story authentic?
- Empower Employee Storytelling: Your people are your best communications asset. Get them talking. Happy employees are the best advocates for your brand. Share their stories, celebrate their successes, and let them spread the word on what it’s like to work at your company. There are heaps of tools out there if you want to streamline this process.
- Promote Flexibility: Flexibility is the lifeline for attracting those with long-term health conditions or other legitimate concerns. Be human and make it a core part of your brand. In a world where long-term sickness is the driving force behind economic inactivity, your ability to offer flexible conditions can make or break your hiring success.
- Be Transparent: Authenticity and transparency will earn you trust—and that’s worth more than any benefits package. Candidates value honesty, and they can spot a marketing gimmick from a mile away. Make sure your employer brand reflects the reality of working at your company.
Final Thought: The Talent Market Isn’t Waiting for You
The UK labour market is changing rapidly, and your ability to adapt will determine whether you sink or swim. Employer branding is the life raft you need in these turbulent waters. It’s no longer a secondary concern—it's the key to surviving and thriving in a competitive talent landscape. So, what’s your next move? Will you sharpen your employer brand, or watch your competitors sail ahead?
Takeaways
What is economic inactivity, and why is it increasing?
Economic inactivity refers to people who are not in work or looking for it. Long-term illness and early retirement are significant factors in this rise, with inactivity hitting 9.3 million people in 2024.
How does employer branding help attract talent?
A strong employer brand positions your company as a desirable workplace, making you more attractive to top candidates even in a shrinking talent pool.
Why is authenticity important for employer branding?
Candidates want to work for companies that align with their values. Being authentic builds trust and attracts long-term talent.
How can companies compete in a tighter labour market?
By focusing on their employer brand, offering flexibility, and showcasing a commitment to well-being and diversity.
Why does flexibility matter in recruitment?
With economic inactivity due to long-term illness at record levels, candidates are looking for workplaces that offer real flexibility and support.
What are the risks of ignoring employer branding?
You risk losing top talent to competitors, which will lead to higher recruitment costs and longer hiring times.
What’s the first step in improving employer branding?
Start by auditing your current employer brand. Be honest about whether it reflects who you truly are and what you offer.
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