• Strongest rise in permanent placements since March 2010
  • Temp billings increase at fastest pace in over 15 years
  • Permanent salary growth highest since October 2007


The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs – published today – provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies.

Stronger rises in permanent and temporary appointments

The number of people placed in permanent jobs continued to increase in December, with the rate of expansion accelerating to the sharpest since March 2010. Growth of temp billings also quickened, reaching its fastest pace for over 15 years.

Vacancy growth holds near 15-year high

Demand for staff continued to increase strongly in December. The rate of expansion of job vacancies was little-changed from the 15-year high posted in November.

Permanent salaries rise at fastest pace in over six years…

Average starting salaries for people placed in permanent jobs increased further in December, with the rate of growth the strongest since October 2007. Temporary/contract staff hourly pay rates rose at a solid pace that was slightly slower than in the previous month.

…amid declining availability of candidates

The availability of staff to fill permanent job roles continued to fall in December. The latest reduction was the steepest since November 2004. Although easing slightly from November’s nine-year record, the rate of decline in temporary/contract staff availability remained substantial.

Regional and sector variation

Mirroring the trend observed for permanent staff, the fastest growth of temp billings in December was recorded in the Midlands, while the North posted the second-sharpest rise.

Private sector demand for staff remained much stronger than that in the public sector, according to the latest survey data.

In the private sector, marked rates of vacancy growth were signalled for both permanent and temporary workers. Public sector demand for permanent staff stagnated in December, whereas temporary vacancies rose at a solid pace.

Demand increased for all nine permanent staff categories covered by the survey in December. The strongest rate of expansion was signalled for Executive/Professional workers. Nursing/Medical/ Care, IT & Computing and Accounting/Financial also registered strong rates of growth.

Higher levels of demand were signalled for each of the nine temporary/contract staff categories in December. IT & Computing posted the fastest growth, with Nursing/Medical/Care and Accounting/Financial completing the top three places in the demand for staff ‘league table’.

The Recruitment and Employment Confederation’s head of policy Kate Shoesmith says: “The UK labour market is starting the New Year in robust form. Our latest figures show sharp growth in the number of people finding new permanent jobs and the most rapid rise in starting salaries since October 2007. Increasing demand for temp workers has driven up hourly pay rates for agency workers for the eleventh month on the trot. Growing confidence means more and more employers are willing to invest in their workforce and take on more people.

“The real concern now is the mismatch between demand and supply with recruiters reporting that they can’t source suitable candidates for vacancies in a whole range of sectors. Companies want to hire more salespeople, accountants and businesses development staff to help their enterprises grow, but can’t find people with the right skills to take the jobs.”

Bernard Brown, Partner and Head of Business Services at KPMG, comments: “Combine the latest job figures with news that business confidence has reached a new high and it’s easy to share the renewed sense of optimism amongst employers.  Permanent placements alone have hit a 4-year peak and with temporary hires accelerating to a 15-year high there is clearly room for corporate investment and, with it, job creation. Little wonder there is speculation suggesting Mark Carney might revise the unemployment benchmark at which an interest rate rise will be considered.

“The recovery is clearly gaining momentum, but it will remain delicate until exports show stronger growth.  As a result employers and individuals, alike, will be keeping an eye on interest rates and the impact any changes have on the pound in their pocket before deciding if a new job is the way to go.  Some uncertainty still remains because the availability of staff to fill roles has seen a steep fall – the biggest for almost 10 years.  It’s a particularly strong pattern in the Midlands and across London, and one which should be monitored carefully.  The risk is that if it continues employers who are desperate to fill a gap could become stretched beyond their means at the same time as over-inflating the market by offering high salaries just to tempt employees to move.”