The jobs market in the UK is still growing but at a slower pace than earlier in the year, according to CEO of the Recruitment and Employment Confederation (REC) Kevin Green.
He suggests that the last few months have shown that a “two-speed labour market” has developed, where companies in the private sector are successfully creating jobs at the same time that public sector employment is being squeezed.
Green’s comments accompany the publication of REC and KPMG’s Report on Jobs, which indicates that permanent staff placements eased in March following February’s ten-month high, while recruitment agencies’ temporary and contract billings also increased at a slower pace month-on-month.
Demand for staff was high in March though, with the survey’s data indicating that permanent staff vacancies rose at the fastest pace for 11 months, while the availability of temporary/contract roles grew at the sharpest rate for almost four years.
“The good news is that vacancies are rising at their highest rate since April last year and March is the 18th consecutive month that vacancies have grown - this demonstrates increasing demand for new staff from private sector businesses,” Green said.
March’s Report on Jobs also shows that starting salaries for permanent staff has increased, and the REC CEO said two factors are driving this trend.
“Firstly, people changing jobs are clearly looking for higher pay to compensate for inflation and secondly there is growing competition for quality candidates in some sectors.
“Whilst it’s important to reward quality candidates appropriately, it’s also important that this trend doesn’t limit opportunities for job creation or hinder business growth in the future.”
A study published by the Chartered Management Institute (CMI) and XpertHR last week highlighted that salaries in the retail industry grew by 2.8 per cent on average in the last 12 months, outgrowing the UK average by 0.6 per cent.
CEO of the CMI Ruth Spellman said that retail’s strong performance was “good news” because salaries within the industry are traditionally some of the lowest around.
She added: “Of course, no-one should believe that the only way to retain employee loyalty is by throwing money around. It’s not practical in the current climate and wider evidence exists to show that money is not the main motivator.”