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Scotland – Temporary and permanent job candidates in increasingly short supply

15 September 2014

Scotland’s labour market continued going from strength-to-strength in August, with the latest Bank of Scotland Report on Jobs indicating further marked gains in placements during the month, as well as strong pay growth amid rising demand for staff.

The latest data, however, also showed the most marked deterioration in permanent candidate availability in the survey’s history, a further sign of increasing tightness in the jobs market.

The Bank of Scotland Labour Market Barometer, a composite indicator designed to provide a single figure snapshot of labour market conditions, registered 67.1 in August, a slight decline from the survey-record high of 67.3 in July. The barometer remained above the equivalent UK index for the second consecutive month. An Index of 50 indicates that there has been no change in the labour market compared with the previous month.

Donald MacRae, Chief Economist at Bank of Scotland, commented: “August’s Barometer returned a strong reading showing a rising number of people appointed to both permanent and temporary jobs. There was a record drop in people available for jobs and growing evidence of strong growth in pay confirming the tightening of the jobs market. The economic recovery continues with business confidence remaining high.”

Aberdeen-based recruiters reported the sharpest growth in both permanent appointments and temporary billings, while Edinburgh reported the least marked increases in both permanent and temporary recruitment.

Permanent candidate availability deteriorated to the greatest extent in Glasgow, while temporary candidate supply fell fasted in Dundee. The strongest growth in permanent starting salaries and hourly pay rates for temporary staff was in Glasgow.

Permanent salary inflation in Scotland eased from July’s survey-record high in August, but remained sharp and greater than the UK-wide average for the second consecutive month. Recruiters also recorded another robust increase in average hourly pay rates for temporary/contract staff in August.

The availability of candidates for permanent vacancies deteriorated by the greatest extent in the series history in August. Temporary candidate availability also deteriorated rapidly, albeit to a slightly lesser extent that in July.