Permanent staff placements continue to rise but at slowest rate for five months

Permanent staff placements continued to rise in June but at the slowest rate for five months, new research has revealed.

The Report on Jobs survey, by the Recruitment and Employment Confederation (REC) and KPMG, has found the hiring of permanent staff has continued to increase for the past 11 months, but in June the rate of increase was the slowest seen since January.

The number of permanent placements rose to 60.7 – on a scale where 50 indicates no change – down from 61.3 in May.

The survey also revealed the growth in temporary and contract staff placements continued but at the slowest rate for seven months, down to 57 compared to 59.2 in May. This slowing in the growth of temporary placements was due in part to weaker demand for short-term staff from the public sector.

Demand for permanent staff was strongest in the construction and engineering sector, where placements reached 63.7, compared to 33.8 in June last year.

Executive and professional roles, as well as IT and computing jobs, also saw a rise in permanent placements, recording 62.7 and 61.4 respectively.

Kevin Green, chief executive of the REC, said: “Demand for permanent staff continues to grow. This is an encouraging sign the jobs market is stable and, in some sectors such as construction and engineering, rapidly growing. However, with the predictions of up to 600,000 job losses in the public sector, it is still too early to tell how much of a knock-on effect this will have on job creation in the private sector.”

Bernard Brown, partner and head of business services at KPMG, added: “It can now be only a matter of time before we will start to see the impact of the government’s efficiency savings strategy, which is likely to leave hundreds of thousands of public sector workers looking for employment. The big challenge will be to transfer as many of these jobs as possible to the private sector through outsourcing and divestment, otherwise the economy will be put under enormous pressure at all levels.”

The survey also revealed average starting salaries awarded to permanent new recruits rose for an eighth consecutive month in June, and this rate of increase remained at the same rate as in May (53.9).

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