More than three-quarters (78 per cent) of recruitment agencies in the UK are feeling confident about hiring activity across the country's jobs market over the coming 12 months.
This is one of the many findings of a recent survey carried out by Saffery Champness, which is the company we use to audit our accounts here at PayStream.
But with Brexit looming and the nationwide skills shortage continuing, why are recruiters still so optimistic? And how are they planning to navigate their way through any challenges that 2017 may throw at them?
Recruiters' confidence is growing
The research from Saffery Champness led to the discovery that the number of agencies that are confident about the year ahead is slightly lower than it was 12 months ago, when 86 per cent of recruiters reported a positive outlook for the coming year.
However, in light of the major political events that took place in 2016 - namely the EU referendum and the subsequent appointment of a new prime minister - the fact that more than three-quarters of recruiters are still confident is well above the expectations of many.
What's more, over one-third (34 per cent) of respondents to the survey reported that they are currently more confident than they were at the start of last year, which demonstrates that optimism is growing as the new year gets underway. This may be fuelled by the fact that more than half (57 per cent) of agencies are now more profitable than 12 months ago, according to the survey results.
But what about the fact that Britain is set to begin the formal process of leaving the EU early this year?
Thoughts on Brexit and its effect on hiring
Last year, 57 per cent of those questioned by Saffery Champness said they would be voting for Britain to remain in Europe, but this rose to 70 per cent in reality. Before the monumental vote back in June, 42 per cent of recruiters felt that the UK's relationship with Europe was important, with this since rising to 59 per cent.
As a result, almost two-thirds (63 per cent) of recruitment agencies reported that they were concerned about the possible knock-on effect of uncertain economic conditions on hiring over the coming 12 months, but the overall optimism cited by poll respondents suggests that firms are feeling well-equipped to face any challenges head on.
What new contractor opportunities will be available this year?
With recruitment firms recognising that there may be a few challenges to wade through in the initial post-Brexit days, two-thirds (65 per cent) revealed that they will be taking on more sales staff over the course of 2017, creating opportunities for individuals willing to work on a temporary contract basis as a result.
Overall, Saffery Champness' figures show that contractor placements increased throughout the UK in 2016, rising by 58 per cent over the 12-month period. This meant that more temporary billings were made than permanent placements, which rose by 56 per cent during the year in comparison.
In addition, 39 per cent of recruiters revealed that they had increased their in-house headcounts over the past year, suggesting that more staff were needed to help handle the increased number of contractor placements they were dealing with.
However, half of recruiters report that they were concerned about the lack of available consultants in the jobs market at present.
Challenges recruiters are anticipating
Agencies also reported a number of other concerns for the coming year, with the biggest worry (cited by 83 per cent of recruiters) being that there won't be enough contractors available to fill positions. Therefore, this means that limited company contractors need to be putting themselves out there, showing clients the potential value they could add to their operations and passing on their knowledge and expertise to others to help prevent the skills shortage from worsening further.
At a different end of the scale, more than one-quarter (28 per cent) of recruitment firms said they were concerned about increased competition for roles in some sectors, meaning that other industries would be left struggling with the skills shortage alone.
With this in mind, contractors should be thinking about what skills they have that could be transferable to other sectors to help them navigate their way through the ongoing skills crisis.