The beginning of the year brought a continuation of a cautious jobs market, yet the resilience it has shown offers a hopeful outlook amidst the wider period of economic uncertainty. This perspective is drawn from the latest insights from the KPMG and REC Report on Jobs, which highlights key trends from both the employer and candidate viewpoints.
Cautious hiring, but opportunities are out there
Hiring decisions are being approached with caution by employers, a natural response to the uncertain economic climate. While there has been a noticeable decline in the number of individuals being placed into permanent roles, marking seventeen months of this trend, it's encouraging to note that 26% of recruiters report an increase in job placements. This indicates a nuanced market where opportunities still exist; you might just need the help of a skilled recruitment agency to find them efficiently. The UK has always been adaptable and resilient, turning to temps when the economic climate is uncertain, and this is still the current trend.
Salaries are starting to stabilise
In recent times, we've seen a surge in starting salaries and wages for temporary roles due to the high demand for skilled candidates. However, this trend has begun to stabilise, with February showing the slowest rate of salary growth in nearly three years. This moderation suggests a move towards more sustainable salary growth, meaning employers should regain some confidence in securing excellent candidates.
Demand for staff tapers, easing the tight labour market
The demand for staff is easing, transitioning us from a market where demand far exceeded supply. This shift is evidenced by a quicker reduction in staff demand last month, marking the fastest rate of contraction since early 2021. This change is not uniform across sectors, with industries such as retail (where demand for staff is low) making it an unbalanced average when considered against office support jobs.
Candidate supply increases, giving employers more choice
The increasing supply of candidates over the past year has given employers a broader choice, although the pace of this growth is starting to slow. Many job seekers are considering temporary roles, a trend that aligns with current market conditions. London leads the way with candidate supply for temporary roles.
Neil Carberry, REC Chief Executive, said, “The temporary labour market is the unsung hero of the economic uncertainty of recent years. It keeps the cogs of the economy turning amidst uncertainty and labour shortages – but it still needs nurturing.”
Although uncertainty may linger until after the election and until economic confidence is restored, there remain significant opportunities for both employers and candidates. Finding the right partner to navigate these opportunities is key. We are dedicated to assisting you in leveraging these changes. Reach out to us for support in making the most of the job market's current dynamics. Call us now, our recruitment market experts are here to help on 0207 7870 7177.