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England – Strongest increase in temporary billings for 29 months

08 August 2013

The number of people placed in jobs by recruitment consultancies rose at a strong and accelerated pace in July 2013, according to research carried out by the Recruitment & Employment Confederation (REC) and KPMG.

Agencies’ billings received from the provision of temporary and contract staff rose at a stronger rate in July. The latest increase was the most marked in almost two-and-a-half years. Stronger client demand, and in some cases, good weather were reported to have boosted temporary appointments during the latest survey period. 

Bernard Brown, partner and head of business services at KPMG, commented: “With house price and service sector figures moving in an upward direction, indications are that the economy is getting stronger. Confidence is certainly evident amongst employers; with many conserving cash for a number of years, they are beginning to invest in their people, and as the search for talent is stepped up, the jobs market is looking buoyant again.”

“High levels of demand for staff were signalled across every sector we analysed and the same can be said across each region of the UK. In a sign of the surge in confidence, the latest figures also represent the sharpest increase in permanent placements for more than three years and the biggest growth in demand for six. This does, of course, mean that a gap exists between the demand for staff and the quality of candidates available so the onus is on candidates to improve their skills and prove their capabilities,” he continued. 

Demand for both permanent and temporary staff at sharper rates during the last survey period, as a result of the fastest rise in vacancies in six year. Public sector demand for temporary staff rose at a solid pace that was the fastest so far this year. Growth in the volume of temporary billings was broad-based across the English regions in in July. The strongest increases were seen in the North and the South.

Data from the Office for National Statistics (ONS) showed that job vacancies were up +12.1% on an annual basis in the three months to June. That was up slightly from the +11.3% increase for the three months to May, and the fastest growth since mid-2004.

Improved levels of demand for temporary staff were recorded across nine employment categories. The fastest growth was recorded in Nursing/Medical/Care, followed by Construction, and Blue Collar. The slowest growth was recorded in Accounting/Finance, followed by Executive Professional, and Hotel & Catering. Temporary and contract staff continue to be in short supply in several sectors; including Accounts, Oil & gas, Construction, Software developers, Nurses, and Sales.

Data from July indicates lower levels of temporary and contract staff availability for the first time since March 2008. Lower availability was recorded in the North and South during the latest survey period. There was no change in the Midlands, while London registered a modest improvement.     

Kevin Green, chief executive for REC, commented: “The jobs market continues to skyrocket with permanent employment and temporary placements at three and two year highs, and vacancy growth accelerating to a six year high. A combination of confidence returning to the UK economy, and higher employer demand, have contributed to this impressive set of figures.”

“Starting salaries accelerated in July reaching the highest for 26 months. This is an early indicator of increased competition for candidates and skills shortages in a growing number of sectors. In addition to this, hourly rates for temp workers increased at the strongest rate since January 2008. We anticipate starting salaries increasing over the coming months as the economy strengthens and competition to secure talent ‘hots up’,” he added.     

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