As London average house prices reach the dizzy heights of £500,000, according to the Land Registry, it seems that London (and to some degree the South East) continues to be a law unto itself.
Many young graduates and those looking to further their careers head to London for the best jobs and some CV enhancing. However, for these hopefuls, unless they are lucky enough to have family in London, the shocking reality of house prices and rental costs are often an obstacle, if not a complete barrier to the city. A London based CBI poll found that 57% of managers said they were struggling to recruit entry level employees due to the high cost and low availability of housing. Almost a third said that employees were having to leave their jobs because costs are too high. They even reported that it can be difficult to employ senior staff.
With these extortionate house prices, a buyer purchasing an ‘average’ priced London house with a 5% cent deposit will face monthly mortgage repayments of around £2,500. This has paved the way for ‘generation rent’ and the average cost of renting in the city currently stands at over £2,500 a month too, according to Countrywide.
The fact that many may feel the need to move to London to progress their career or to work in an organisation’s head office leaves little choice, other than moving further away from central London, with an increasing commute. Long commuting times eat into an employee’s personal time and can lead to less of a work-life balance than desired! It can also leave organisations with late or absent staff as they face more chance of travel delays and disruptions.
What happened to London’s less popular areas, in that they quickly saw trendy regenerations when everywhere else got too expensive to live, may be happening throughout the rest of the UK. The ‘northern powerhouse’ could really come into action as candidates seek opportunities outside of the M25.
The latest Tech Cities Job Watch suggested that Manchester, Leeds, Bristol and Glasgow are advertising more and more tech roles. There are also many start-ups based all across the country recruiting fresh talent, so perhaps a spread of skills would also contribute to the spread of prosperity outside of London?
As the Mayor of London introduces a £5 million digital skills programme for young Londoners, it is recognised that, in at least some sectors, there is a skills shortage in London, and the price of living there appears to be a key factor in this. However the number of digital technology companies in London is growing and that growth is set to continue, so perhaps the shortage is not as critical as some report.
If you’re a hiring manager in London and are experiencing these kind of issues, we’d like to hear from you. We’ve built relationships with a wide selection of skilled candidates over the years and if you’re looking to hire IT or HR professionals, we’re sure we can help.
