Report on UK Jobs
The Report on UK Jobs is unique in providing the most comprehensive guide to the UK jobs market, drawing on original survey data provided by recruitment consultancies and employers to provide the first indication each month of labour market trends.
The main findings for December are:
Permanent staff appointments fall at quicker pace
The number of people placed into permanent jobs fell for the third month running at the end of 2022, as increased economic uncertainty and pressure on budgets weighed on recruitment plans. The rate of reduction was the quickest seen since January 2021, when the third national lockdown dampened hiring. Temp billings meanwhile expanded further in December, though the rate of growth remained modest overall.
Overall growth of vacancies slips to 22-month low
Recruitment consultancies signalled a sustained rise in demand for staff in December. That said, the overall rate of vacancy growth weakened for the ninth straight month and was the slowest seen since the current period of recovery began in February 2021. This was driven by a weaker upturn in permanent staff demand, as temp vacancies expanded at a slightly quicker pace.
Candidate supply falls at softest pace since March 2021
Uncertainty surrounding the outlook also dampened candidate availability, as more people became cautious around seeking out new roles in the current climate. Combined with an already tight labour market, this drove further drops in the supply of both permanent and temporary labour. However, reports of redundancies in some areas meant that the overall rate of decline eased to the weakest in 21 months.
Starting pay increases at slower, but still strong rate
The latest survey indicated that pay pressures continued to soften at the end of the year, but remained strong in the context of historical data. Notably, rates of both starting salary and temp pay growth hit their lowest since April 2021. Where higher rates of pay were reported, this was frequently linked to competition for scarce staff as well as the rising cost of living.
Commenting on the latest survey results, Claire Warnes, Partner, Skills and Productivity at KPMG UK, said:
“The challenging economic environment continues to constrain the jobs market, as December’s data shows. The ongoing industrial relations turmoil in many sectors, along with the scarcity of available staff in all sectors, means that wage inflation may soften only slightly in the near term. Yet, at the same time, vacancy growth rates are trending down again this month from a historically high peak in July 2021, as employers continue to rein in permanent hiring and employees choose to stay put. Overall, the jobs market looks less than rosy at the start of 2023, so employers who hold their nerve and continue to invest in skills in particular are likely to benefit most when the economic upturn comes.”