Key points:
Stronger rise in permanent placements but temp billings fall
IT & Computing and Engineering/Construction staff most in-demand
Permanent salaries fall for first time since October 2009
Temp pay rises at fastest rate in four months
Summary:
The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs – published today – provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies.
Divergent trends in permanent and temporary appointments
Growth of permanent staff placements was recorded for the second month running in February, and at the strongest pace since last May. Agencies’ temporary/contract staff billings, however, fell slightly for the third month running.
Stronger increase in vacancies
Overall demand for staff rose at the fastest pace in four months during February, as a sharper increase in permanent vacancies offset a slower expansion of temp vacancies. Sector data showed that IT & Computing was the most in-demand permanent staff type, while Engineering/Construction was the most sought-after temp category.
Slower rise in staff availability
The availability of candidates to fill job vacancies rose further in February, albeit at a weaker pace. For both permanent and temporary staff, rates of growth were the slowest in three months.
Fall in permanent salaries
Recruitment consultants reported a drop in permanent staff salaries during February for the first time since October 2009. In contrast, temp staff pay rates increased at the fastest pace in four months.
Comments:
Bernard Brown, Partner and Head of Business Services at KPMG comments:
“The latest report raises hopes of a Spring revival in the jobs market with a second successive monthly rise in the number of people securing permanent roles and the data also indicating that February saw the rate of growth accelerating to a nine-month high. Put alongside recent news from the ONS which suggested that the last unemployment figures represented the smallest rise in almost a year and there may be signs that the market is displaying early signs of recovery.
“Yet cautious optimism must remain the watchwords because the picture is not as rosy for temporary positions. Of course, the reduction in contract placements may yet be related to the Agency Workers regulations, but without buoyancy in both the permanent and temporary markets it is still too early to unfurl the bunting.
“For those who have found new employment, we are also seeing rates for wages reducing for the first time since 2009, with a real prospect of continued downward pressure as the year goes on. Given the ongoing squeeze many are feeling as costs go up on the high street, it appears that the price of permanent employment is lower take-home pay, but this is an inevitable consequence of a competitive, yet still fractious, market.”
Kevin Green, Chief Executive of the Recruitment & Employment Confederation, says:
“The labour market is clearly improving as this month’s Report on Jobs shows the strongest performance on permanent placements for nine months. Demand for staff also rose at the fastest pace for four months, so jobseekers should take heart that there are vacancies out there. Slowly, private sector employers are becoming more confident as the gloom, caused by a slowing economy late last year and fears about the Eurozone, recedes.
“The temporary market has shown a slight decline since January and is essentially flat at present. However, agency work continues to provide an important outlet for employers and jobseekers with over a million temporary workers placed on assignments in any given week.
“We are seeing high demand in professional roles such as IT, engineering, legal and HR and chefs continue to be in demand within the hospitality sector. The other sector which seems buoyant is nursing, medical and care. We believe this is because NHS trusts are recognising that using high quality temporary staff when they are needed is a cost effective solution to maintaining a quality service when budgets are being squeezed
“Looking ahead, we anticipate that unemployment will continue to worsen slightly over the next few months. However, with these early indicators of the private sector starting to hire again, the labour market is likely to bounce back towards the end of this year and on into early 2013.”
Full reports and historical data from the Report on Jobs are available by subscription. Please contact economics@markit.com
For further information, please contact:
KPMG
Mike Petrook, KPMG Press Office, 07917 384 576 or mike.petrook@kpmg.co.uk
REC
Helen Ablett, Telephone 08453 700655
Markit Economics (technical/data queries)
Jack Kennedy, Telephone 01491 461087
Note to Editors:
The Report on Jobs is a monthly publication produced by Markit on behalf of the Recruitment & Employment Confederation and KPMG. The report features original survey data which provide the most up-to-date and comprehensive monthly picture of recruitment, employment and employee earnings trends available.
The Report features original research data from Markit, collected via questionnaire from a panel of 400 UK recruitment and employment consultancies. In 2010/11, some 1,049,333 people were employed in either temporary or contract work through consultancies and 604,193 people were placed in permanent positions through consultancies. Data for the monthly survey were first collected in October 1997 and are collected at the end of each month, with respondents asked to specify the direction of change in a number of survey variables.
All Index numbers are calculated from the percentages of respondents reporting an improvement, no change or decline. These indices vary between 0 and 100 with reading of exactly 50.0 signalling no change on the previous month. Readings above 50 signal an increase or improvement; readings below 50 signal a decline or deterioration. Reasons given by survey respondents for any changes are analysed to provide insight into the causes of movements in the indices and are also used to adjust for expected seasonal variations.
Markit do not revise underlying survey data after first publication, but seasonal adjustment factors may be revised from time to time as appropriate which will affect the seasonally adjusted data series. Historical data relating to the underlying (unadjusted) numbers, first published seasonally adjusted series and subsequently revised data are available to subscribers from Markit. Please contact economics@markit.com.
KPMG
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.
Recruitment and Employment Confederation
15 Welbeck Street, London, W1G 9XT. Tel: 020 7009 2100. Fax: 0207 935 4112 Website: www.rec.uk.com
The REC is the professional body representing the UK’s £24.6 billion private recruitment and staffing industry with more than 8,000 recruitment agencies and 6,000 recruitment consultants in membership. There are more than 1 million temporary workers registered with UK agencies who are deployed in industry, commerce and the public services every day.
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