Permanent placements reached a one-year high in February, while demand for staff rose at the fastest rate in 18 months, according to the most recent Markit/REC (Recruitment and Employment Confederation) Report on Jobs.

The Report on Jobs Vacancy Index posting was above the neutral 50.0 threshold at 63.0 in February. This was up from 62.3 in January and the highest increase in demand for staff in 18 months. Demand for permanent and temporary staff reached 18 and 19-month highs, respectively.

The data from Markit and REC also showed that temp billings increased at the softest pace in four months. Furthermore, the availability of staff to fill job vacancies declined in February. Both permanent and short-term candidate supply deteriorated and to a greater extent than at the start of the year, with the permanent recording the sharpest rate of reduction.

“Although permanent placements have hit a 12-month high, businesses across the UK are finding it increasingly difficult to recruit for permanent roles. The big question still remains about how employers will fill their vacancies,” REC Chief Executive Kevin Green said.

Starting salaries for candidates placed into permanent roles increased at the quickest pace since March 2016 in February. Meanwhile, temp pay growth also increased from January and was the second-fastest seen in nine months. February survey data also pointed to a further rise in starting salaries for people placed in permanent roles.

Private sector demand for staff remained stronger than that for public sector staff in February. Furthermore, demand for permanent staff at private sector firms reached a 20-month high, while vacancies for temporary roles in the sector also increased sharply.

Meanwhile, public sector demand rose for both permanent and temporary staff in February.

Demand rose for all permanent job categories in February, with the strongest increases seen for Engineering, IT & Computing and Nursing/Medical/Care staff. Though marked overall, demand for permanent roles was weakest in Hotel & Catering.

Engineering was the most sought-after category for temporary/contract staff in February, closely followed by Nursing/Medical/Care and Blue Collar. The slowest growth was seen for Executive/Professional.

 “The Chancellor is expected to announce a boost for vocational training in today’s budget and this is very welcome. However, it won’t solve the immediate need for people to fill jobs. We’re already seeing acute staff shortages in a variety of sectors, from healthcare to engineering. This is likely to get worse, especially if the Government continues to refuse the rights of EU citizens living in the UK post-Brexit,” Green said.

“On the flip-side, this is a good time for individuals prepared to move jobs, with bumper pay offers on the table as hirers compete to secure the talent available. In the context of rising inflation and stagnating pay growth, changing employers is becoming a more attractive option for those looking for more money,” Green said.