Permanent staff placements increased for the sixth month running during January, according to the Report on Jobs published by the REC and KPMG today.

Although weaker than December’s peak, the rate of growth remained marked. Temporary/contract staff billings also rose strongly, with the pace of expansion only slightly below the previous month’s two-and-a-half year high.

Key points of the Report are:

• Growth of permanent placements eased from December’s peak but remained strong.
• Temporary/contract staff billings continued to rise at marked pace
• Demand aff grew at strongest rate since July 2007.

Higher staff appointments were underpinned by a further improvement in demand for staff. Vacancies increased for the fourth consecutive month, and at the fastest rate since July 2007. The availability of staff to fill both permanent and temporary/contract vacancies continued to rise in January. However, in both cases, the rates of growth eased further from the elevated levels seen in late 2008 and early 2009.
Although permanent staff salaries continued to increase in January, the rate of growth eased slightly and remained weak by the survey’s historical standards. Temporary/contract staff pay rose for the first time since September 2008, albeit only marginally.

Kevin Green, the REC’s Chief Executive says:

“The growth in people getting permanent jobs eased in January but still remained positive overall. The number of vacancies reported by recruitment businesses also accelerated at the sharpest rate since July 2007, suggesting that we are now on the long road to recovery.

“The labour market is out of intensive care but it is still in a fragile state. While employers are hiring more now than at any other time in the last year, the recovery is tentative and must not be put at risk by taxes or regulatory changes.”

Bernard Brown, Partner and Head of Business Services at KPMG comments:

“The UK jobs market is continuing its journey back to health. Placements of permanent and temporary jobs have been rising again in January although at a slower pace than a month before, a reminder that the road to recovery will be bumpy.

“As confidence has returned to the private sector the starting gun for a public sector recession has only just been fired and its impact on the jobs market will be felt over the next 12 to 18 months.”

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