Stalling jobs and salary growth in November may point to impending credit crunch

A continued weakening of jobs growth and salary inflation in November has hinted at an impending credit crunch on the UK economy, new research has found.

November’s Report on Jobs, from the Recruitment and Employment Confederation and auditing firm KPMG, found permanent jobs hit a near two-year low, with wage growth also declining. However, temporary work continued to grow.

Data provided by 400 recruitment firms also showed a further reduction in the availability of candidates to fill vacancies.

KPMG director Alan Nolansaid the credit crunch was tightening its grip onthe economy. “While the job market remains broadly robust, this latest report suggests an underlying weakening, with both demand for permanent staff and vacancies down on the levels earlier this year.

“At the same time, for temporary staff, demand and pay growth have picked up –perhaps a sign that while the business environment remains comfortable at present, employers are becoming more wary about the outlook, and want to increase flexibility,” he added.

Helen Reynolds, acting chief executiveat the Recruitment and Employment Confederation, said: “With temporary billings continuing to increase at a robust rate, this report on jobs highlights the value of a flexible workforce for employers.”

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