Report on UK Jobs – April 2023
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 April are:
Temp billings growth quickens, but permanent staff appointments fall again
UK recruitment consultancies signalled a further shift in hiring preferences from permanent to temporary workers amid lingering economic uncertainty around the outlook and rising costs in April. Notably, permanent placements fell for
the seventh month in a row, and at the quickest rate since the start of 2021. In contrast, temp billings expanded solidly, with the rate of growth the fastest for seven months.
Supply of workers improves for second month running
April data pointed to a sustained improvement in the availability of candidates. The rate at which labour supply improved quickened slightly on the month but remained modest overall. Underlying data showed that a slightly faster rise in permanent candidate numbers contrasted with a softer upturn in temp staff availability. Recruiters often linked higher staff supply to redundancies and workers looking for better paid roles amid the rising cost of living.
Stronger increases in starting pay
Starting salaries for permanent workers continued to rise at a historically sharp pace in April, with the rate of inflation picking up to a four-month high. At the same time, temp wage growth improved to the highest since January. Higher rates of starting pay were frequently attributed to efforts to attract and secure suitably- skilled staff and bumps to pay to reflect the higher cost of living.
Vacancy growth slips to three-month low
Although demand for staff continued to rise in April, the overall rate of vacancy growth slipped to a three-month low and remained weaker than the series long-run average. The softer upturn in demand was largely driven by a slower increase in permanent vacancies, as the number of temp roles increased at a sharper pace.
Neil Carberry, REC Chief Executive, said:
“This data shows how uncertain many employers are feeling right now. The good news is they still need to hire, as growing vacancies show. But firms are hedging their bets. After a better month in March, in April we saw permanent hiring fall back quickly and businesses turn to temps to help them through. London had a particularly difficult month. The picture varies for temporary recruitment too, with REC members reporting weaker demand in some sectors than others as sectors like logistics, driving and food are heavily affected by changing consumer behaviour. Taken together, however, there is still plenty of opportunity out there for jobseekers. Wages are rising strongly for both temps and new permanent hires in the face of inflation, even though candidate availability is finally starting to improve.”
“For employers, hiring is unlikely to get easier soon. Those businesses that succeed will have good, long- term strategies for accessing talent from a wide range of sources, including retraining. Recruiters are well-placed to help with this. Nowhere is the need for a strong hiring strategy more obvious than in our largest employer, the NHS, where the failure to partner properly with NHS staffing suppliers is lengthening waiting times and costing the public purse more than necessary. Reforming NHS frameworks in partnership with the industry would be in the interests of patients, medical staff and the taxpayer.”