Almost half of UK employers, 48 per cent expect to face a growing shortage of skilled candidates to fill permanent jobs in 2017, new research suggests.
For the past six months, employers in the UK have warned of a skills shortage for engineering and technical jobs, and this month's JobsOutlook survey by the Recruitment and Employment Confederation (REC) said health and social care and construction employers are also expecting a shortage of workers to fill vacancies.
One in three organisations, or 32 per cent, said they have no spare workforce capacity, and REC expects these sectors to be under severe pressure in the new year.
Business confidence is improving after an initial drop since the European Union referendum, however.
Of the 601 employers surveyed, 30 per cent said economic conditions are improving, up from 27 per cent in the previous rolling quarter, and 38 per cent expect hiring and investment to improve, up from 33 per cent from the previous month.
In the three months to June, 48 per cent of employers said the UK's economic conditions were improving. That's 18 points higher than this month.
REC chief executive Kevin Green said the government needs to take the skills shortage issue seriously when considering changes to the current immigration policy.
Limiting access to skills and talent from abroad at a time of severe candidate shortages will risk future prosperity for all.
Although UK businesses invested more than £45bn for training and skills development in 2015, the need for support from abroad is immediate, Green said.
This is not a new problem, but if further restrictions are placed on workers from the EU the situation will only get worse. The UK is at near-full employment, and the idea that the domestic labour force could fill all the opportunities available is a non-starter.