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Scotland – Candidate availability a cause for concern for permanent and temporary jobs

18 August 2014

The recovery in Scotland’s labour market moved up a gear in July, according to the latest Bank of Scotland Report on Jobs, which showed survey-record increases in both the number of permanent placements and starting salaries.

Strong and broad-based demand for staff continued to drive the upturn. One cause for concern was a further sharp drop in the number of candidates for vacancies, the level of which has fallen continuously since early-2012.

The Bank of Scotland Labour Market Barometer, a composite indicator designed to provide a single figure snapshot of labour market conditions, climbed to a fresh survey-record high of 67.3 in July, up from 65.1 in June. The barometer was above the equivalent UK index for the first time in four months, albeit only fractionally.

Donald MacRae, Chief Economist at the Bank of Scotland, commented: “July’s Barometer provided further proof of the continuing recovery. The month saw survey-record increases in both the number of people appointed to permanent jobs and in starting salaries. Demand for both permanent and temporary staff was expressed by a surge in vacancies accompanied by a drop in the number of candidates available. These trends should lead to further gains in employment and eventually to an increase in overall earnings growth. The Scottish economy continues to recover strongly.”

All four Scottish regions reported higher temporary billings during July, with Aberdeen reporting the sharpest overall increase for the second consecutive month. Broad-based growth in permanent appointments was also reported across all regions, led by Glasgow.

Recruiters in Dundee registered the sharpest decline in permanent candidate availability, while the most marked decline in temporary candidate availability was in Aberdeen.

For the second consecutive month, growth of permanent staffing salaries in Scotland was at a series record high. In line with the trend in permanent salaries, the rate of growth of hourly pay for temporary staff quickened in July, at its fastest rate since March 2014.

July saw the sharpest rise in the number of people placed in permanent jobs in the survey’s eleven-and-a-half year history. Latest data also showed a further acceleration in the rate of growth in temporary billings, to its fastest pace since January 2014.

The degree to which temporary job opening increased was the most marked for seven year, while the rate of growth for permanent job vacancies hit a four-month high in July.

The availability of candidates for permanent vacancies, however, deteriorated during the month, albeit the rate of decline was slower than the record level recorded last month. Temporary candidate numbers decreased at a faster rate than last month, the sharpest decline since December 2004.   

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