The latest quarterly Labour Market Outlook survey by HR body CIPD found the proportion of businesses looking to expand their workforces in the third quarter of the year has continued to rise since the start of 2021.
The survey’s net employment intentions figure, which measures the difference between the proportion of Scottish employers expecting to add jobs and those planning to cut them, now sits at +29, up from +4 recorded in January.
The 67 per cent of Scottish employers who plan to recruit in the three months to September compares with 45 per cent six months ago and 41 per cent this time last year.
The report reveals that some sectors have seen a particularly dramatic shift as the economy recovers and lockdown restrictions have continued to ease.
Last summer just 26 per cent of UK hospitality, arts and entertainment employers were looking to hire but that figure has now increased to 72 per cent.
In transport and storage, there has been a rise from 33 per cent to 65 per cent of employers looking to hire. Both of these sectors have been impacted by the pandemic and changes to immigration as a result of Brexit, and are suffering from widely reported labour shortages.
As employers struggle with hard-to-fill vacancies, over two fifths of firms said they would look to plug the gap by upskilling existing staff. A quarter said they would hire more apprentices or raise wages.
Lee Ann Panglea, head of CIPD Scotland and Northern Ireland, said the Scottish figures revealed a significant improvement in employer confidence.
“Employers are very optimistic, indicating strong recruitment intentions and redundancy expectations appear much lower than originally predicted during the pandemic,” she said.
“As the furlough scheme winds down, employers will no longer be able to flex their workforce to meet demand by rapidly expanding and contracting staffing levels at minimal cost. Recruitment and retention will have to pick up the slack as employers look to plug any gaps in their workforce.”
Panglea said employers will also need to think more long-term about how they meet skills needs.
“Organisations should look carefully at their recruitment and retention strategies and consider where they need to develop these, for example by increasing investment in training and reskilling. Employers also have a huge role to play in improving working lives, and fair work principles should be kept in mind when building retention and recruitment strategies.”
The report also found that over three quarters of Scottish employers are planning a pay review in the 12 months to June 2022. Over a third of those expect to increase pay, 7 per cent expect a pay freeze and just 2 per cent expect pay to fall.
The number of Scottish employers looking to make redundancies has settled at around 9 per cent, compared to 32 per cent in summer 2020, which the CIPD said suggests that the end of the furlough scheme should be a relatively smooth transition with minimal job losses.