Slough Express

Upturn in hiring activity slows again amid candidate shortage, report finds


The latest KPMG and REC, UK Report on Jobs survey highlighte­d softer rises in hiring activity during March, as candidate shortages restricted growth of both permanent placements and temp billings.

Nonetheles­s, expansions remained sharp by historical standards, fuelled by a further steep increase in demand for staff.

The availabili­ty of candidates to fill roles continued to fall sharply, however, with overall staff supply dropping at the quickest rate for four months.

The imbalance of labour supply and demand drove further substantia­l increases in rates of starting pay, with salaries for new permanent joiners rising at the quickest rate on record in March.

The report is compiled by S&P

Global from responses to questionna­ires sent to a panel of around 400 UK recruitmen­t and employment consultanc­ies.

The overall availabili­ty of workers in the UK continued to fall rapidly at the end of the first quarter.

Notably, the rate of contractio­n was the steepest seen for four months, with a slightly quicker drop in permanent candidate numbers offsetting a softer fall in temp labour supply.

Panellists often mentioned that a generally low unemployme­nt rate, uncertaint­y related to the pandemic and the Russian invasion of Ukraine, fewer EU workers and robust demand for staff had limited worker availabili­ty.

Recruitmen­t consultanc­ies signalled a further increase in permanent starting salaries in March.

Moreover, the rate of inflation was the sharpest in 24-and-a-half years of data collection amid reports of intense competitio­n for staff.

Average wages for temp workers also rose in March, and at a rapid pace that was the quickest for three months.

The Midlands registered the sharpest increase in permanent placements of all four monitored English regions.

The softest, but still marked, expansion was seen in the South of England.

All four monitored English regions noted marked upturns in temp billings at the end of the first quarter, led by London.

Vacancies rose across both the private and public sector at the end of the first quarter. The strongest expansion in demand was signalled for permanent staff in the private sector, while the softest increase in vacancies was seen for permanent staff in the public sector.

As has been the case in each of the prior four months, IT & computing recorded the steepest increase in demand for permanent staff of all 10 monitored sectors in March. The softest, but still sharp, rise in permanent vacancies was seen in retail.

March survey data also pointed to a broad-based increase in temporary staff demand, with hotel & catering topping the rankings.

Neil Carberry, chief executive of the

REC, said: “We can clearly see that labour and skills shortages are driving inflation in these latest figures.

“Starting salaries for permanent staff are growing at a new record pace, partially due to demand for staff accelerati­ng and partially as firms increase pay for all staff in the face of rising prices.

“Record COVID infection levels are also pushing up demand for temporary workers, particular­ly in blue collar and hospitalit­y sectors, underpinni­ng the ability of temps to seek higher rates.

“However, the overall number of placements being made is starting to stabilise.

“This is no surprise after a period of historical­ly high growth, and in the face of more economic uncertaint­y. Even so, the jobs market is very tight. Businesses will need to broaden their searches and be creative in making their offer to candidates more attractive, in consultati­on with recruitmen­t experts.”

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