Salary expectations have increased as the number of job vacancies grew by over 9% last quarter, while the number of professionals seeking new employment rose 11.5%, according to the latest Morgan McKinley quarterly economic monitor.

There was an average of 22,900 jobs available in the second quarter, up from just under 21,000 during the first three months of the year, while the average number of jobseekers rose from 72,151 to 90,412 over the same period.

Salary expectations have risen among new hires, with candidates seeking higher salaries as part of contract negotiations, driven by the volume of new positions outstripping the number of available candidates and inflation of over 9%.

Tracy Keevans, global FDI director at Morgan McKinley Ireland, said the jobs market is being driven by candidates at this time as the economy has rebounded following the lifting of restrictions and the country nears full employment.

"IDA Ireland has had a strong start to the year with Q2 showing strong investment in Ireland by new and existing investors. 155 new investments were won for Ireland in the first half of the year bringing significant employment potential of up to 18,000 jobs," Keevans continued. 

In Association with

"Enterprise Ireland clients too have had a strong start to the year on the back of a historical record for the number of net new jobs created in Irish companies in 2021.   

“The supply and demand effect of professionals is driving an increase in salaries for new starters with many seeking to off-set the impact of rising inflation by negotiating higher starting salaries.  

"In a candidate driven market employers have to offer more competitive salary and benefits to attract new hires or at least consider deploying more creative compensation and benefits packages that will appeal to the talent cohort they are seeking to attract."

Keevans added that hiring managers have been "feeling the pinch," especially in the most competitive sectors, and that companies have reverted to offering learning and development opportunities and flexible working arrangements to attract candidates.

"Remote working has become the benefit most in demand.  It is now expected that some element of remote working will be available and many candidates will not entertain opportunities where at least some element of remote working is not offered," she said.

"We see this particularly in the tech sector, where a Morgan McKinley poll found that 51% of candidates surveyed would refuse to put their CV forward for a role if it did not permit them a full-time remote working arrangement.

"This appetite for remote working is also extending to roles which traditionally were performed onsite. We are currently seeing engineering and life sciences professionals pushing for hybrid working arrangements and requesting one or two days of remote working."

Experience of working from home during Covid and inflated fuel costs have driven demand for remote working, but among some young people sharing rented accommodation, working from the office has become preferable.

"There is a danger that this cohort will be overlooked and not catered for in the ‘new norm’ of hybrid or remote working," Keevans said.

"However, the increasing price of housing and the shortage of accommodations continues to be an issue for companies who do not offer fully remote working options.

"In this sense, we are seeing employers refusing to consider applicants who are not already living in the commuting area of their offices as they do not have confidence that applicants who are willing to relocate will be successful in securing accommodation should they be offered the job due to the housing shortages.” 

Tech multinationals are also seeking to normalise their return to office-based employment by insisting that employees must relocate to Ireland by the end of August in order to meet Revenue requirements, having hired staff working remotely abroad during the pandemic.

The report also shows that hiring among the early-stage, investor-backed tech start-ups has been restrained, taking on staff in line with productivity and business needs but no longer hiring at will.

(Pic: Getty Images)