New figures published yesterday reveal a 7.3% drop in the number of advertised job vacancies in the UK since the start of the year, as experts warn fears that the UK may leave the European Union are fueling job market uncertainty.

One of the biggest uncertainties surrounding “Brexit” is the fact that such an exit has never been done before, so no one really knows what the exact fallout will be. This is in addition to major concerns that the impact of a Brexit would be profound and irreversible, and would lead to a significantly diminished international role for the UK.

There has been a marked drop in advertised vacancies since the start of the year, and warnings that discussions about the UK leaving the European Union is fuelling job market uncertainty. 

“Hiring habits are changing, it’s a sign of potential instability and employers are retaining their best workers for longer,” says Doug Monro, co-founder of Adzuna.

According to Adzunda’s latest Job Market Report, jobseekers are facing fewer options in 2016, as falling vacancies and rising competition impact upon work prospects. This contradicts the Department for Work and Pensions statement that:

“Official figures show that job vacancies are at an all-time high, with a record 31.4 million people in work and the unemployment rate now at a 10-year low.”

The Job Market report summarises that:

• ‘New year, new job’ phenomenon fails to take off, as employer hiring drops off amid bosses’ successful long term focus on retaining and upskilling existing employees
• January sees number of advertised vacancies fall 7.3% to 1,079,711, declining for the second consecutive month as jobseekers find themselves with fewer choices
• Competition for jobs hots up, rising to 0.61 applicants per vacancy from 0.54 in December, as Northern cities Sunderland and Hull see toughest competition
• Manufacturing, Finance, Energy, Media and Retail sectors see cuts in January, resulting in thousands of job losses across the UK’s core industries
• Advertised salaries, meanwhile, show a glimmer of hope, rising 0.8% month-on-month to reach £33,593 in January, with Northern Ireland and Wales leading the recovery
• French the top foreign language for new hires in the UK jobs market despite Brexit fears, with 8,401 current vacancies looking for French linguistic skills.

Monro comments: “January’s jobs market has failed to take flight. The normal rhythm of hiring hasn’t happened – vacancy levels are down and job competition is getting tougher. Fewer options for those looking for new jobs is putting pressure on career plans. Hiring habits are changing in a sign of potential instability and employers are retaining their best workers for longer.”

He goes on to say:

 “A potential Brexit brings new unknowns into the jobs market. Politicians are at risk of fuelling uncertainty fears – and only increasing doubts. By doing so they’re risking a weaker jobs market. It’s a dangerous game to play – thousands of employers and employees are already on edge. This lack of consensus is causing understandable concern for many companies. Business expansions and hiring sprees are being put on hold as a result. EU languages are still in high demand throughout the UK and whichever road the referendum takes us down, this is sure to remain so.”

“Languages have always been vital to the international ambitions of companies. But now they’re becoming even more lucrative to have as a jobseeker. A French speaker, or German speaker in a company can make all the difference and open up new business channels and deals. In the interconnected world, learning a second language is a fantastic way to differentiate yourself from other applicants and claim a higher salary. It’s hard work to learn a foreign tongue, but employers are willing to pay more for it – so it’s a skill worth pursuing. For industries such as IT, which is growing its international reach, and for healthcare, which is dealing with more diverse patients than ever, having another language may soon become a necessity.”

January saw a total of 1,079,711 job vacancies advertised in the UK, down 7.3% from 1,164,502 in December – in the largest monthly drop since 2012. Advertised job vacancies have now fallen 13.7% since November, when 165,000 more jobs were on the market (1,244,772). A long-term focus on upskilling existing employees and prioritising retention means companies can now sidestep the search for fresh talent, filling positions in-house rather than looking elsewhere.

Widespread job losses across a range of UK sectors mean several industry key players are no longer in a position to take on new hires. Energy giant BP cut 7,000 jobs earlier this month, alongside the loss of over 2,500 manufacturing roles by Tata and Bombardier. Lloyds and Virgin Media similarly saw large job losses of 1,755 and 900 employees respectively. The Retail and Manufacturing sectors have seen large vacancy falls in the wake of job losses in January. Current vacancies in the Manufacturing sector stand at 14,022 – down 9% from 15,466 roles last month. Similarly, the Retail sector saw vacant positions fall 13% to 32,143, from 36,881 in December.

Jobseekers with language skills are managing to buck the downward vacancy trend however, as demand for multilingual workers has risen.

There are currently over 35,000 job vacancies for applicants with linguistic skills and with an average advertised salary of £36,026 for bilingual positions across the UK.

French is the most popular language with employers, with 8,401 available positions currently asking for proficiency. This is closely followed by German (7,820 vacancies), Spanish (4,267) and Italian (3,856).

There is a rare consensus amongst UK economists: they overwhelmingly believe that leaving the EU is bad for the country’s economic prospects. In the Financial Times’s annual poll of more than 100 leading thinkers, not one thought a vote for Brexit would enhance UK growth in 2016.

A recent Government report has also warned that it could take more than 10 years to set up new trade details and negotiate Brexit, and car manufacturing, farming, financial services and the lives of millions of Britons would be impacted negatively. Bosses at more than a third of the UK’s biggest businesses have also signed a letter supporting the campaign to remain in the European Union. Chairmen and chief executives at 36 FTSE 100 companies – including BT, Marks & Spencer, Kingfisher and Vodafone – warned a Brexit would “deter investment and threaten jobs.” The 36 are among the names of 200 business leaders, representing 1.2 million employees, to put their names to the letter.

The heads of six British companies owned by German car giant BMW, including  Mini and Rolls-Royce have told British workers that exit from the European Union could drive up costs and have an impact on its workforce. A letter was sent to 8,000 Rolls-Royce employees, including workers in Goodwood, West Sussex, and Oxford. A report produced this week warned that the car industry would be badly hit by Brexit.

It outlines how more than half of MINIs and most of the British-made engines and components are exported to the EU. Also, it described how Brexit would hit hard the way Rolls Royce brings in cars and spare parts from the continent.

“Tariff barriers would mean higher costs and higher prices and we cannot assume that the UK would be granted free trade with Europe from outside the EU.

“Our employment base could also be affected, with skilled men and women from most EU countries included in the 30 nationalities currently represented at the home of Rolls-Royce here at Goodwood,” the letter said.

Nearly 1,000 projects at 78 UK universities and research centres are dependent on funds from the European Research Council (ERC). The UK has more ERC-funded projects than any other country, accounting for 22% of all ERC-funded projects – more than 25 recipient countries put together. The collaborations that have made the UK such an important player are dependent on the free movement of scientists into the UK. About 15% of academic staff at UK institutions are non-UK EU nationals, a figure that rises to 20% among elite universities.

You can read the full Job Market Report here