By Daniel Hunter

The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs has shown that although further increases in both permanent staff placements and temporary/contract staff billings were recorded in March, the latest expansions were only slight and the slowest in six and seven months respectively.

Growth of job vacancies moderated further in March, reaching a seven-month low. Demand for both permanent and temporary/contract staff rose at weaker rates.

The availability of candidates to fill permanent job roles decreased for a fourth successive month in March. That said, the rate of deterioration remained only modest. The availability of temporary/contract staff meanwhile increased slightly, maintaining the trend seen since the turn of the year.

Permanent staff salaries and temporary/contract staff pay both increased at moderate rates in March. In the case of the latter, inflation was at a 12-month high.

The Midlands, North and South all registered higher permanent placements in March. London, however, saw a renewed decline following two months of growth. Increased temp billings were signalled in the Midlands, North and London during March, whereas the South posted a marginal fall.

Private sector vacancies continued to increase during March. Expansions were signalled for both permanent and temporary staff, albeit at slower rates compared with February.

In the public sector, demand for temporary workers increased for the first time in three months. However, demand for permanent employees was down marginally. Demand rose for all eight types of permanent staff monitored by the survey during March. The strongest rate of expansion was signalled for IT & Computing workers, as was the case in February. Hotel & Catering registered the slowest growth of vacancies.

For the fourteenth consecutive month, Nursing/Medical/Care was the most in-demand category for temporary/contract staff during March. Engineering/Construction workers were also highly sought-after in the latest survey period. In contrast, demand for Hotel & Catering staff fell for the first time in six months, albeit marginally.

“The fact that in March more people secured jobs than in the previous month is obviously good news, although the rate of growth has slowed. However the most significant issue is the emergence of a two speed labour market with a lack of candidates for highly skilled roles at the same time as persistent levels of unemployment," REC chief executive Kevin Green said.

“Recruiters report that businesses are willing to pay better starting salaries to get the right talent but are struggling to find people with the right skills and experience as candidate availability declines. It’s a worrying trend that is particularly problematic across IT and engineering and at senior levels in other sectors. Persistent skills shortages in these areas could have a disastrous impact on critical infrastructure projects, especially if employers can’t find the talent they need to jump-start new ventures in energy, transport and construction.

“The government needs to build the talent pipeline for the future by increasing funding for apprenticeships in sectors where there is demand, refocusing the Work Program to train people who have potential but who lack the skills to fill current vacancies and driving take-up for existing schemes like the Youth Contract.”

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