Rate of increase in permanent staff placements falls

The rate of increase in permanent staff placements dropped in January from the peak seen last December.

The latest Recruitment and Employment Confederation (REC) and KPMG Report on Jobs, out today, found the number of permanent staff placed in work continued to increase in January, but the index fell from 62.8 in December to 60.5 – on a scale where 50 indicates no change (see chart below).

In December, job placements saw the largest increase for nearly two-and-a-half years.

The increase in the number of temporary staff placements in January also dipped slightly from 59.7 in December to 59.

The number of staff vacancies in January increased at the fastest rate since July 2007 and for the fourth consecutive month – from 60.4 in December, to 61.6 in January – as demand for employees returned.

The strongest growth in demand was for IT workers, which increased from a score of 32.2 in January 2009 to 67.7 in January 2010, while demand for executive and professional employees also increased from 29 in January 2009 to 63.6 this year.
Kevin Green, chief executive of the REC, said January’s figures showed the UK jobs market was “out of intensive care” and was now “on the long road to recovery”.

“The growth in people getting permanent jobs eased in January but still remained positive overall,” he said. “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 past year, the recovery is tentative and must not be put at risk by taxes or regulatory changes.”

The Report on Jobs also revealed availability of staff to fill permanent vacancies continued to rise in January, but at a lower rate than in December – from 56.8 in December to 53.9 in January.

Permanent staff salaries continued to increase in January, but the rate of increase dropped from 53.7 in December to 53.

Meanwhile, pay for temporary and contract staff rose for the first time since September 2008 as the index hit 50.6, up from 49.5 in December.




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