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 March are:
March sees further slowdown in hiring activity
Latest survey data pointed to softer expansions in both permanent staff appointments and temp billings across the UK in March. Though elevated by historical standards, rates of increase fell to 12- and 11-month lows, respectively. Recruiters frequently mentioned that candidate shortages continued to weigh on their ability to fill vacancies.
Steepest drop in total staff supply since last November
The overall availability of workers in the UK continued to fall rapidly at the end of the first quarter. Notably, the rate of contraction was the steepest seen for four months, with a slightly quicker drop in permanent candidate numbers offsetting a softer fall in temp labour supply. Panellists often mentioned that a generally low unemployment rate, uncertainty related to the pandemic and Ukraine war, fewer EU workers and robust demand for staff had limited worker availability.
Starting salary inflation hits new record
Recruitment consultancies signalled a further increase in permanent starting salaries in March. Moreover, the rate of inflation was the sharpest in 24-and-a-half years of data collection amid reports of intense competition for staff. Average wages for temp workers also rose in March, and at a rapid pace that was the quickest for three months.
Demand for staff increases at fastest rate for six months
Overall vacancies rose for the fourteenth month in a row in March, and at the quickest rate since last September. Recruiters indicated stronger rises in both permanent and temporary staff demand in the latest survey period, with the former noting the steeper rate of growth.
Commenting on the latest survey results, Claire Warnes, Head of Education, Skills and Productivity at KPMG UK, said:
“There’s no end in sight to the deep-seated workforce challenges facing the UK economy. Once again this month, job vacancies are increasing while there are simply not enough candidates in all sectors to fill them. With fewer EU workers, the ongoing effects of the pandemic, the economic impacts of the war in Ukraine and cost of living pressures, many employers will continue to struggle to hire the talent and access the skills they need. With unemployment staying low, there are many great opportunities for job-seekers to join or rejoin the workforce in all sectors.”
Neil Carberry, Chief Executive of the REC, said:
“We can clearly see that labour and skills shortages are driving inflation in these latest figures. Starting salaries for permanent staff are growing at a new record pace, partially due to demand for staff accelerating and partially as firms increase pay for all staff in the face of rising prices. Record COVID infection levels are also pushing up demand for temporary workers, particularly in blue collar and hospitality sectors, underpinning the ability of temps to seek higher rates. However, the overall number of placements being made is starting to stabilise. This is no surprise after a period of historically high growth, and in the face of more economic uncertainty. Even so, the jobs market is very tight. Businesses will need to broaden their searches and be creative in making their offer to candidates more attractive, in consultation with recruitment experts. But government can help by incentivising investment in skills and people during the inflation crisis.”