Recruitment of permanent and temporary staff slowed in February, as candidate shortages restricted UK recruiters’ ability to fill roles.
The latest Report on Jobs survey from the Recruitment and Employment Confederation (REC) and KPMG showed that permanent staff appointments grew at their slowest rate in 11 months, causing starting salaries for permanent contracts to rise at the second-fastest rate in 24 years of data collection.
The north of England saw the sharpest overall increase in permanent hiring activity, while the steepest rise in temp placements was recorded in London.
Total candidate availability declined at the quickest rate since November 2021, while the number of vacancies across both private and public sectors reached a three-month high.
A sharp increase in demand for permanent staff was across all ten monitored job categories, with the most vacancies seen in the IT and computing sector. The softest increase in vacancies was seen in secretarial/clerical job roles.
The 400 UK recruiters polled generally attributed the fall in candidate supply to continued demand for staff, but some indicated that pandemic-related uncertainty lingered and the supply of candidates from abroad had also been limited.
Neil Carberry, chief executive of the REC, said: “Candidate availability has now been dropping for a year, which shows the scale of the labour shortage the UK faces. Recruiters are filling record numbers of posts, but demand is still rising.”
He said the organisations that are filling their vacancies are those that are working more collaboratively with recruiters to get their candidate offer right.
He urged the government to rethink the forthcoming National Insurance increase to ensure that employers can afford to invest in wages and training “at a time when firms and workers are hard-pressed by inflation”.
Claire Warnes, head of education, skills and productivity at KPMG UK, said: “While recruitment activity has slowed slightly, employers across all sectors continued to hire energetically during February, as their workloads increased and vacancy growth accelerated for the first time since last summer. But the lack of suitable candidates continued and fuelled yet further increases in starting salaries.”
Meanwhile, Acas-commissioned research has found that 41% of UK employers expect headcount at their organisation to increase over the next year.
Forty-seven per cent expected staff numbers to stay the same; 7% expected headcount to shrink; and 4% were unsure.
Acas chief executive Susan Clews said: “Many businesses experienced a challenging time due to the impact of Covid and the employees at those organisations may have felt that they faced an uncertain future.
“As we come out of the pandemic restrictions, it is very encouraging to see a turnaround with two in five employers expecting an increase in staff in the year ahead and nearly a half expecting no change.
“Businesses that are looking to employ new staff should check out Acas’s good practice advice and training on how best to recruit people, follow employment law and avoid discrimination.”