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The UK unemployment rate is close to a 50-year low point, having dropped by 0.2% to 3.8% for February to April 2022, and those unemployed for up to six months increased over this three-month period, marking the largest increase since late 2020.

The number of job vacancies in March to May 2022 also rose to a new record of 1,300,000, and the rate of growth in vacancies continued to slow down

According to the Office for National Statistics, the economic inactivity rate also decreased by 0.1% to 21.3% in the quarter, largely driven by those economically inactive because they were students.

The number of job vacancies in March to May 2022 also rose to a new record of 1,300,000, and the rate of growth in vacancies continued to slow down.

ONS said that those unemployed for between 6 and 12 months also decreased to a “record low”, and those unemployed for over 12 months also continued to decrease.

Meanwhile, the UK employment rate increased by 0.2% in the quarter to 75.6%, although this is still below pre-Covid levels. All in all, the number of full-time employees increased over the quarter to a “record high”, which was partially offset by a decrease in the number of part-time employees.

ONS said the most timely estimate of payrolled employees for May 2022 shows a monthly increase, up 90,000 on the revised April 2022, to a record 29.6 million.

Additionally, growth in employees’ average total pay (including bonuses) was 6.8% and growth in regular pay (excluding bonuses) was 4.2% in February to April 2022. Growth in total pay was 0.4% but regular pay fell on the year by 2.2%.

Sam Beckett, ONS head of economic statistics, said: “Today’s figures continue to show a mixed picture for the labour market. While the number of people in employment is up again in the three months to April, the figure remains below pre-pandemic levels.

“At the same time, unemployment is close to a 50-year low point and there was a record low number of redundancies. Job vacancies are still slowly rising, too. At a new record level of 1.3 million, this is over half a million more than before the onset of the pandemic.”

She added: “The high level of bonuses continues to cushion the effects of rising prices on total earnings for some workers, but if you exclude bonuses, pay in real terms is falling at its fastest rate in over a decade

This article appeared Accountancy Today

Most employers have recognised a skills shortage in their workforce, or expect to have shortages in the next five years, according to new research from PwC. 

The firm found that concerns around skills shortages were “profound”, with 33% experiencing a current shortage in core business skills such as teamwork, leadership, relationship-building and communication skills, while a further 41% expected to have shortages in the year ahead. 

According to PwC, there is also a “real need” for capacity building for the net zero transition as over three quarters (76%) of employers already have a shortage of the skills needed to support the transition to net zero or expect to within the next 12 months (36% and 40%, respectively). 

Nonetheless, it found that employers generally showed “broad positivity” about the education system, with around 70% of respondents agreeing that it prepares young people well for work, life, and to work at organisations like theirs. 

Employers were more divided on potential curriculum changes that would better serve the needs of their organisation, however, while 21% ranked young people getting more practical work experience as the curriculum change that would have the greatest impact. 

Weaving digital skills throughout all subjects followed, ranking first for 17%. A greater focus on career options, greater focus on practical application of subjects, and making Maths and English compulsory followed – each were first choice for around 12-13% of respondents. 

Only 5% of respondents ranked employers having more input in the curriculum as the most impactful potential change. 

Employers were broadly satisfied with the current assessment system, with almost 70% agreeing the current system helps young people to develop both social skills and problem solving / independent thinking. 

Around two thirds (65%) thought assessments prepared young people for the type of work their organisation does and 73% thought it accurately tests academic ability. 

When asked what would be the top benefit of reimagining education to better meet their organisations needs, one in five (19%) ranked being able to contribute to a more resilient UK economy or being able to contribute to a more socially inclusive UK economy as the top-ranking benefit. 

PwC said it was clear that employers “have a huge appetite for clarity and collaboration on pathways from education to employment”, with 87% saying their organisation would benefit, and 85% saying employers and education providers should work together on this.

Kevin Ellis, chairman and senior partner at PwC UK, said: “Exams have their place but they can be unduly influenced by someone’s background and the opportunities given to them. They’re not the best measure of potential. Employers will miss out on talent if they measure it through one lens alone. Assessment needs to be more inclusive.

“Basic numeracy and literacy should be a given. We also need other skills that stand the test of time, such as empathy, resilience and agility. You can’t predict all the jobs that will exist in the future but you can predict the mindset needed to adapt and be ready.”

Writes Heather Sandlin in Accountancy Today(Edited)

The UK government is plotting a series of initiatives to enable the domestic endorsement and adoption of new international sustainability standards, according to Debbie Crawshawe, accounting expert at the Department for Business, Energy and Industrial Strategy (BEIS).

Speaking during a Financial Reporting Council (FRC) webinar on Wednesday, Crawshawe said that the government intends to create a “mechanism to endorse and adopt” international standards for use in the UK, and that crucially, this will entail distilling the “complex” standards into something more compatible with domestic legislation.

“The endorsement process will need to take account of the complexity of existing UK legislation and existing UK regulatory frameworks relating to environmental matters and sustainability matters more generally,” she told attendees.

“This existing complexity, and the need for disclosure requirements to support and be consistent with government policy may well result in adaptations of the international standards to ensure suitability for UK use.”

In March, the newly-established International Sustainability Standards Board (ISSB) published its first set of global guidelines for public consultation. The guidelines are divided into two exposure drafts, with the first setting out general sustainability-related disclosure requirements, and the second detailing specific climate-related disclosure requirements.

The ISSB’s guidelines are said to be building upon recommendations set out by the Taskforce on Climate-Related Financial Disclosures (TCFD). In April, the UK became the world’s first jurisdiction to mandate TCFD-aligned disclosures for its largest businesses.

According to Crawshawe, the government will look to introduce a similar mandate on the use of UK-adopted international sustainability standards by “certain economically significant entities”.

A public consultation to determine the scope of such legislation is expected shortly, she added.

“We expect that the consultation will cover matters such as the scope of entities required to report, and in considering scope, we will take into account any new [public interest entity] definition which may come out of the government’s audit and corporate governance reform work.”

In addition, Crawshawe outlined that the consultation will cover the manner in which an entity is required to report on sustainability, where in the report this should be included, when this reporting should commence, and options for the assurance of this information.

“We appreciate that there will be a number of related consultations taking up your valuable time over the next year, but we encourage you to respond to the government’s consultation when published in order to help us shape this important new area of legislation.”

The comparability and adoption of standards

Crawshaw’s comments on the importance of domestic adoption were echoed by Sarah-Jane Dominic, head of policy, programmes and strategy at the FRC, who argued that the ISSB’s recent work provides “a great opportunity to streamline requirements”.

“What we don’t want to end up with is a situation where companies are subject to two or more sets of similar but slightly conflicting requirements,” she said.

“We will look to provide exemptions from existing disclosure obligations where international standards are complied with.”

The panel also weighed in on the issue of global fragmentation, with Sue Lloyd, the ISSB’s vice chair, outlining ongoing efforts to encourage adoption in different jurisdictions.

The ISSB has established a “jurisdictional steering group”, she explained, which will bring together representatives from China, Japan and the UK in an attempt to bring US and European standards closer to that of the ISSB.

“It’s literally getting in a room and finding similarities and differences. We need to be open to moving in their direction, and we’re hoping they’ll be open to moving in ours.

“We really want to bring ourselves closer together so we don’t have so many tensions and conflicting requirements.”

Crawshawe argued that the ease of adoption will depend on “the journey that the country has taken so far” in terms of the maturity of its sustainability disclosures.

“The UK is generally seen as a leader in respect of sustainability disclosures, and so I think it is likely to be one of the first jurisdictions to go down a mandatory route,” she said.

“We would hope that would encourage other jurisdictions to follow, but we are definitely mindful that in jurisdictions where the maturity is not as great, the voluntary approach may well be taken.”

The UK has said that it expects to use the ISSB standards when they become available, while the US Securities and Exchange Commission has indicated that its own disclosure rules are expected to be finalised later this year.

Another noteworthy contender to the ISSB’s proposals has been the EU’s Corporate Sustainability Reporting Directive (CSRD), which comes into force in January 2023.

As part of the CSDR requirements, companies are expected to report on “double materiality” – both financial and non-financial – going beyond the current proposals outlined by the ISSB.

Writes Sam Alberti in Accountancy Age(Edited)

This marks the largest monthly figures on record for the sector, as it was 13% higher than the previous record turnover that was reported in January 2022

The UK accounting industry saw its turnover rise to £4.13bn in March, marking a rise of 14% against February 2022, according to new figures from the Office of National Statistics (ONS).

This marks the largest monthly figures on record for the sector, as it was 13% higher than the previous record turnover that was reported in January 2022.  

Overall, revenues for the UK Services Sector (including accounting) reported a turnover of £243.4bn, soaring 20% against February 2022.

Commenting on the figures, Julie Matheson, regulatory partner, Accounting Services at Kingsley Napley LLP said: “The UK’s accounting industry continues to build strength in 2022. These results should be an indicator of the sector’s robustness in the post-lockdown economy. 

“Firm leaders, however, need to be nimble and continue to focus on staff well-being to attract the best people in a highly competitive market. They should also be concentrating on upcoming regulatory headwinds including audit reform and wider issues in corporate governance, and on expending resources on preparing for the inevitable change that is coming.”

Writes Heather Sandlin in Accountancy Today(Edited)