Business Society

The Impact Covid-19 is Having on Employment and the Recruitment Sector

The UK recruitment sector has been experiencing steady growth over the last five years. In 2019, the industry achieved a turnover of £38.9bn, which is rather impressive, considering the uncertainties surrounding the impact of Brexit. The COVID-19 pandemic has had a considerable impact on economies around the world, and despite the many laudable initiatives set up by the government including the Coronavirus Job Retention Scheme, predicted at £42bn, the most recent figures are showing the sharpest decline in the recruitment sector ever since the global economic crisis of 2009. Here, experts at digital recruitment agency, Stopgap, share their predictions.

Employment Rates

Thanks to the growth seen in the recruitment sector, the UK has been able to achieve its lowest unemployment levels since the 1970s. However, this positive impact has been quickly thwarted, with March seeing a record number of unemployment claims. The number of claims for universal credit increased by an astounding 910%, and the overall predicted unemployment rate increased from 3.8% in Q1 2020 to 10% in Q2, levels last witnessed in 1993.

Impact on Businesses

Understandably, the hospitality and leisure industries have been the most affected by the COVID-19 crisis. The lockdown measures put in place by the government have led to many businesses being closed, leading to a halt in services. According to research, 46% of employees in hospitality and leisure were expected to be furloughed, and an estimated 11 million employees in all industries expect to be let go or furloughed over the next couple of months. Even though the leisure sector tops the list of jobs at most risk, the mining, transportation, and consumer-oriented industries such as retail and recruitment are also at very high risk.

While these figures are worrying, the public’s attitude towards the whole situations indicates that this is just a short term economic hiatus instead of a full-blown depression. The GDP was projected to see a decline of 35% for Q2 2020, accompanied by a swift recovery for Q3/Q4, before stabilising at the beginning of 2021. So, what exactly does this mean for the recruitment sector?

A couple of months ago, projections indicated a slight 3-6% year-on-year growth for the recruitment industry for 2019-2021 while struggling to overcome the challenges presented by the looming exit from the European Union. However, this pandemic has brought forth a whole new set of challenges and the businesses that can adapt and survive the current situation will have an edge in what is potentially a changing world of employment.


It is safe to say that recruiters will have a crucial role to play in the post-COVID-19 world. The levels of unemployment are projected to dip to the 6.6% mark by the end of the year, and the recruitment sector will be key in preparing and organising the UK workforce again and also in assisting clients to adapt to the new recruitment environment. This includes the acquisition of new technologies such as virtual onboarding and video interviewing and incorporating flexible and remote workforces.

Recruiters operating in industries that are currently experiencing an increased demand of workers, for example, healthcare, life sciences, and pharma have probably had to make drastic changes in how they work to provide the support needed in the fight against this pandemic. These markets are expected to expand in the coming future since this pandemic has brought to light the inefficiency of the current level of investment. More focus will be put into healthcare technology and increasing the levels of staffing. Recruitment organisations that have rapidly adopted working remotely and from home, have invested in technology and established a strong yet flexible operational foundation will be best suited to uphold and gain from future growth.


The takeaway here is that we need to be prepared. The employment and recruitment landscape has changed forever, and when the recovery phase begins, things will be very different from what we were once used to.