REC report on jobs: Demand for staff remains strong, but employers are cautious

Written by
Kevin Green

16 Aug 2016

16 Aug 2016 • by Kevin Green

This article is a part of the Good Recruitment Channel

The record-high employment rate and ongoing skill shortages have made it difficult for employers to find suitable candidates for the roles available in the past, and this remains the case. We’re now seeing the added problem of individuals deciding to stay put rather than change jobs in the current environment.

While there are worrying signs, it’s important we don’t jump to conclusions from one month’s data. The truth is we don’t know what long term consequences the referendum result will have on UK jobs; with the political situation becoming more stable and the Bank of England making sensible decisions, we may well see confidence return to the jobs market more quickly than anticipated.

Permanent placements fall at steeper rate...

The number of people placed in permanent roles decreased for a second successive month in July. The rate of contraction accelerated to the sharpest since May 2009, with panellists frequently citing Brexit-related uncertainty. A particularly marked impact was reported by consultancies based in London.       

...while temp billings growth eases further

Temporary/contract staff billings continued to rise in July, with some panellists indicating that clients had shifted focus towards short-term staff amid an uncertain economic climate. However, the latest increase in billings was the weakest in ten months.  

Permanent salaries rise at slowest rate in over three years

Starting salaries for successful permanent candidates increased further in July. That said, the rate of growth eased to a 38-month low. Temporary/contract staff pay meanwhile rose at the slowest rate since February.  

Candidate availability remains tight

Permanent staff availability continued to fall in July. The rate of decline eased to the slowest since October 2013, although remained marked overall. Temporary/contract staff availability meanwhile decreased at the sharpest pace since February.

Regional and sector variation

The most marked decline in placements was seen in London, while falls were also recorded in the Midlands, South and Scotland. Only the North saw a rise in placements (albeit the weakest in over three years).
Higher temp billings were recorded across all regions with the exception of London, where the rate of decline was the most marked in seven years. 

Growth of demand remained stronger for private sector roles than those in the public sector during July. Private sector temporary workers again registered the fastest increase overall.
Nursing/Medical/Care was the most in-demand category for permanent staff during July. On the other hand, Construction workers saw a decline in demand for their services, albeit modest overall.     

Mirroring the trend seen for permanent staff, Nursing/Medical/Care was the most sought-after category for short-term employees during July. The slowest growth was signalled for Executive/Professional staff
The Markit/REC Report on Jobs provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies.  

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This article is a part of the Good Recruitment Channel