High-speed UK economy continues to expand

Job
vacancies are rising at the fastest rate since March 2001 and wages and
salaries continues to increase.

The
Report on Jobs for May, published by the Recruitment & Employment
Confederation and Andersen, finds that the growth of permanent staff placements
hit fourteen-month high in May.

The
report said that clients’ preferences for flexible workforces in the face of
continuing economic uncertainty, combined with the knock-on effects of the
World Cup and Queen’s Jubilee, saw temporary staff billings rise, increasing at
the fastest rate since March 2001.

The
Report on Jobs Vacancies Index, which monitors demand for staff at recruitment
consultancies, shows the demand for permanent staff also rose at the fastest
pace since March 2001.

Recruitment
consultancies also reported an increase in overall staff availability for the
twelfth month running in May.

Consultancies
said rising demand and the persistence of certain skills shortages placed
further pressure on wages and salaries in May.

Permanent
staff salaries rose at the fastest rate for eleven months, while temporary
staff pay rates rose at the fastest rate since last September.

Commenting
on May’s survey, Brett Walsh, head of UK human capital at Andersen said:

"The
labour market showed a further tightening in May, with demand for staff from a
wide range of employers picking up significantly during the month. With the
pool of available, suitably qualified staff continuing to diminish, it is
natural that wage pressures strengthened again. However, the extent of the
increase in demand for staff and associated upward movement in pay rates
clearly remains much less marked than seen prior to the downturn of last year,
attributable to a positive but cautious attitude of employers to future growth
prospects."

Tim
Nicholson, chief executive at REC said: "May’s Report on Jobs shows
growing signs of business confidence as displayed by the continuing increase in
demand for permanent staff. Fewer job losses reported in the manufacturing
sector is a good sign for the UK economic outlook, although as last week’s CIPS
survey figures demonstrated, the recovery appears to be sluggish and companies
remain cautious with regard to future expansion plans."

By Quentin Reade

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