Your Business and Industry
UK workforce data – how we can help your residential clients
Figures from the Office for National Statistics showed that, in March 2023, self-employment jobs rose by 82,000. The total increase in total workforce jobs is said to be the largest on record… so how does this affect your mortgage advice?
We continue to see an increased appetite for change and flexibility amongst the UK’s workforce. For instance, according to ONS statistics, the proportion of people changing jobs increased during the last decade, grew on average by 5.2% between 2010 and 2018.
While we all face our own set of financial challenges in the current economic landscape, a vast number and array of job opportunities remain available throughout the UK labour market with well over a million vacancies registered in March to May 2023.
Additional figures from the Office for National Statistics showed that, in March 2023, UK workforce jobs rose to a new record of 36.8 million. This represented an increase of 395,000 since December 2022, with the largest contribution from employee jobs of 308,000, and additional rises in self-employment jobs of 82,000 and government-supported trainees of 6,000. The quarterly increase in total workforce jobs is said to be the largest on record and was broadly based across a range of industries. In March 2023, the number of workforce jobs surpassed its pre-coronavirus (COVID-19) pandemic position (December 2019) by 1.2 million.
These are substantial figures which help demonstrate just how many opportunities remain available for those who may be looking to change jobs or pick up ‘extra’ work.
This greater level of fluidity also means that people are much more likely to have multiple jobs, which means multiple incomes. This can lead to differing monthly incomes over a longer period, as individuals may work different hours week to week, with take-home pay fluctuating.
This trend has created the term ‘portfolio career’ which essentially covers multiple roles within a broader sector which can result in freelancers, contractors, consultants and self-employed people working across multiple projects at one time.
To help such borrowers, new and existing, the lending community need to be increasingly adept at adapting our systems and processes to meet the needs of today’s workers and consider multiple jobs, incomes and fluctuating pay when underwriting. At Foundation, we have seen a growth in demand for the specialist residential mortgage products we offer.
Have a look at our range of Residential case studies
To meet this growing demand, we have broadened out the income we will consider as part of an application covering those potential multiple income sources and now include up to 100% of commission; personal and state pension income; investment income; net rental income; maintenance income; maternity and paternity income; and trust incomes.
Without this approach, we are not considering the individual(s) ability to afford the mortgage on an ongoing basis. We previously called some of those incomes mentioned above ‘unusual’ however, advisers will know that these are not unusual anymore, and these types of borrowers are most in need of your advice.
It’s been suggested that the specialist mortgage market will treble in size by 2030 and this prediction remains highly relevant as the specialist residential sector in particular continues to grow. Whether that client is a professional starting out on a career, a self-employed director with retained profits, a young first-time buyer with multiple jobs or someone looking to borrow into retirement and utilising SIPP income, there’s an array of client types who will come to you with a complex case that needs a switched-on specialist lender who is willing to look beyond a basic residential approach. And we are always on hand to help deliver solutions which can make a real difference for them.
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