As KPMG and the Recruitment & Employment Confederation release their latest comprehensive guide to the UK labour market, we summarise the topline takeaways from the report.
Staff Appointments
Permanent staff appointments continued to fall, stretching the current sequence of decline to nine months. This was linked to uncertainty over the economic outlook and the subsequent slowdown of staff hiring, with many noting recruitment freezes and delayed decision making. This fall was noted across all regions, bar the North of England who registered the first upturn in placements since February.
Meanwhile, the data revealed an increase in temporary staff placements, albeit mild, with many suggesting a preference for short-term staff during the uncertain economic climate. During this period, all areas saw an increase, the steepest being in London, bar the North which registered a decline.
Vacancies
Vacancy growth slipped to a 28-month low in June, with the softest increase seen since the current sequence of expansion began in March 2021.
Vacancies continued to expand for both permanent and temporary roles across the UK, with the latter seeing a steeper rate of growth.
Demand for workers continued to rise across both the private and public sectors at the end of the second quarter, though permanent roles in the private sector saw the softest rate of expansion since February 2021. The strongest rise in demand during this period was for permanent public sector staff.
In terms of sector, the steepest increase in demand across Permanent vacancies was in Hotel & Catering and Blue Collar roles, with Hotel & Catering seeing the greatest demand in temporary vacancies by a wide margin. Meanwhile, across Permanent and Temporary vacancies, IT and Computing seeing lower recorded vacancies month on month.
Staff Availability
The data revealed a rapid increase in overall availability of staff across the UK in June, with the rate of expansion the sharpest seen since the end of 2020. Outside of the pandemic period, this marked the steepest upturn in candidate numbers since November 2009.
Breaking this down, June saw the steepest upturn in permanent staff supply for two-and-a-half years, with the improved availability in candidates linked largely to company redundancies, alongside those looking for new roles which allowed for home working. This was seen nationwide, with the quickest upturn seen in the London area.
Temp candidate numbers also saw rapid expansion, extending the current period of growth to four months. This sharp acceleration was seen nationwide, most notably in the Midlands.
Pay Pressures
The average starting salary awarded to permanent workers across the UK continued to increase in June, albeit at a softer rate for the second month in a row. According to panel members who were surveyed, as per previous months, this rise reflects efforts to attract scarce candidates and the higher cost of living. The North of England registered the steepest upturn in permanent pay, whilst the South of England saw the softest.
While June saw an increase in Temporary pay rates for the twenty-eighth month in a row in June, the rate of inflation was the softest recorded since April 2021. Again, this was attributed by those surveyed to competition for staff and the rising cost of living. This softer increase was seen seen in all four monitored English regions bar London in June.
Report summary
Staff recruitment held back by lingering uncertainty over the outlook
Candidate supply rises rapidly in June
Starting pay increases at softest rate since April 2021
Vacancy growth eases to 28-month low
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