By Daniel Hunter

The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs, published today (Friday), has shown that recruitment consultants indicated a rise in permanent staff placements for the fourth month running during January.

Growth held steady from December’s solid rate. Temp billings meanwhile increased for the sixth month in succession, with the pace of expansion quickening slightly in the latest survey period.

Demand for staff continued to increase at the start of 2013. The rate of growth in permanent vacancies quickened to a 21-month high, but temp vacancies rose at a slightly slower pace than in December.

Average starting salaries for people placed in permanent jobs continued to increase in January. Although still moderate, the rate of inflation was at a 16-month high. Contributing to the rise in salaries was a deterioration in the availability of permanent staff, albeit only slight.

Hourly rates of pay for staff in temporary/contract employment decreased for the first time in five months during January. That said, the fall was only fractional. Short-term staff availability meanwhile rose moderately.

“The war for talent has begun. January saw the sharpest rise in starting salaries in well over a year after a nine-month trend of increases," REC director of policy and professional services Tom Hadley said.

"The rise is caused by continued growth in permanent vacancies paired with a reduction in candidate availability. This is good news for workers but also highlights the need to address the current 'skills disconnect' which presents a major barrier to growth in key sectors of our economy.

“Skills shortages in whole sectors like engineering and IT and for particular roles like chefs, drivers and sales is spurring competition for qualified staff. Employers are realising that to secure the talent they need they have to offer more attractive salaries.”

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