By Daniel Hunter
The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs has shown stronger increases in permanent and temporary appointments than was expected.
Growth of permanent staff placements accelerated markedly in June, reaching the fastest rate for over two years. Similarly, temporary/contract staff billings rose at a much sharper pace, with the latest increase the strongest in seven months.
The rate of expansion of job vacancies accelerated to a three-year high in June. Sharper increases in demand were signalled for both permanent and temporary workers.
Permanent staff salaries rose at the fastest pace for 23 months in June. Temporary/contract staff pay growth also quickened, reaching the sharpest since March 2008.
Recruitment consultants signalled a further drop in the availability of candidates for permanent roles during June. However, temp availability continued to improve.
The South posted the fastest rise in permanent appointments during the latest survey period, closely followed by the North. The Midlands saw a solid expansion, while London recorded a moderate increase.
Temporary/contract staff billings rose in each of the four monitored English regions, although in the case of the Midlands growth was marginal. The North posted the strongest increase.
Public sector permanent vacancies rose for the first time in six months during June, while public sector temporary/contract vacancies were unchanged from May.
In the private sector, both permanent and temporary/contract vacancies increased at the fastest pace since data were first available in December 2011.
Growth of demand was broad-based across all nine types of permanent staff monitored by the survey in June. Engineering remained the most sought-after category, posting a substantial increase in vacancies. The slowest rates of expansion were indicated for Blue Collar and Hotel & Catering workers.
REC chief executive Kevin Green said: “We are now seeing the UK jobs market blast off with the highest number of people being placed in permanent jobs for two years and demand for staff at a three year high.
“The UK jobs market has been agile enough to weather the recession and emerge with more people in work than ever before and has performed considerably better than our European counterparts.
“Our main concern is that the soaring success of the jobs market and signs of economic recovery could be undermined if the government does not do more to address the growing skills gap. Roles in engineering and IT are in ever increasing demand as recruiters struggle to source the talent that businesses need to succeed. However more roles, such as sales and digital marketing, have been added to this growing list in the last couple of months and show no signs of disappearing.
“The war for talent in growth sectors is driving starting salaries to increase at the fastest pace in two years.”
Bernard Brown, Partner and Head of Business Services at KPMG, said: “It’s often said that things happen ‘in threes’ and the latest jobs data has provided the hat-trick, complementing positive reports about the services sector and UK GDP.
“Certainly as Mark Carney reflects on the first week in his new job, he must be delighted as all the signs seem to be pointing towards an economy on an upward trajectory.
“The latest figures reveal permanent placements enjoying their highest growth rates for over two years and temporary roles being filled at the quickest pace since Christmas. Perhaps the sun has finally come out to shine on the jobs market and economy at large?
“Employers seem to think so. Many have stepped up their search for staff with demand for staff accelerating to a three year high. Confidence is even beginning to show itself with employers prepared to increase the salaries they offer to new employees.
“At the same time, candidates are still hedging their bets. We are still witnessing a cautious approach with many hanging on to the jobs they know, fearing the insecurity that comes with starting somewhere new. Yet, if the economy continues along its current path, it is likely that candidates will also step out in increasing numbers as the year goes on.”
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