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UK – Salaries rise but workers still reticent to move

08 November 2013

Recruitment consultants signalled further increases in both permanent placements and temporary billings during October, according to the latest ‘Report on Jobs’ survey from the Recruitment and Employment Confederation (REC) and KPMG.

Although easing marginally from September, the rates of expansion remained considerable. Overall demand for staff rose at the fastest pace since June 2007. Higher vacancy levels were signalled for both permanent and temporary workers, in both the public and private sectors, and across all monitored job categories.

Commenting on the latest survey results, Bernard Brown, Partner and Head of Business Services at KPMG, said: “For those who have set government policy the latest figures are great news, with higher numbers of job opportunities emerging alongside the sharpest increase in permanent wages for 6 years, as demand continues to strengthen. Whilst this is a sure sign of economic recovery, we must not get complacent because, in the higher earning bracket, left unchecked wage inflation will bring different challenges to businesses who strive for profitable growth.”

“Another question that must be addressed revolves around whether increasing salaries are enough to entice job hunters to move between organisations. All the evidence suggests not, with permanent and temporary staff availability falling in recent months. It means employers cannot rely on wages alone as a hook to attract top talent. The time has come for them to develop a raft of offers as part of the overall remuneration package. If they fail to do so, they will struggle to recruit and bring their organisation back to pre-downturn levels,” he added.

All four monitored English regions saw higher permanent placements, the strongest growth was recorded in the Midlands, while the slowest expansion was indicated in London. The Midlands also reported the strongest temporary jobs growth, while the South registered the slowest rise.

Starting salaries for successful permanent candidates rose further in October, with the rate of increase accelerating at its strongest since December 2007. Temporary worker pay rates also rose, albeit at the slowest pace in four months.

Steeper falls in both permanent and temporary staff availability were reported in October, with the rates of decline the sharpest in around six years. In the private sector, permanent staff saw stronger demand growth than temporary/contract workers, while in the public sector the reverse was true.

Engineers remain the most sought after professionals for both permanent and temporary positions. For permanent placements this was followed by Construction workers and IT & Computing professionals. For temporary positions Blue Collar workers were the second most sought after workers, followed by Nursing/Medical/Care workers.

Hotel & Catering workers were the least sought after permanent workers, while Executive/Professional workers were the least sought after temporary workers.          

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