Jobs market shows signs of stabilising in July – KPMG/REC
The latest KPMG REC Jobs Report shows that recruitment activity moved closer to stabilisation in July, with both permanent placements and temporary billings declining at much softer rates than in the prior four months. Nonetheless, reductions remained marked overall amid reports that the coronavirus disease 2019 (COVID-19) pandemic continued to weigh on clients’ hiring decisions.
Recruitment consultancies signalled a steeper increase in overall candidate availability at the start of the third quarter, driven largely by redundancies stemming from the pandemic. Furthermore, the supply of temporary workers rose at the fastest rate in over two decades of data collection, while the upturn in permanent labour supply was the second sharpest on record.
A combination of rising staff supply and subdued demand for workers added further downward pressure on starting pay in July. Starting salaries and temp pay both fell markedly in the latest survey period, despite rates of decline easing since June.
Overall vacancies fell for the fifth month running in July, with marked falls signalled for both permanent and temporary positions. That said, the rates of contraction were notably slower than those recorded in the prior three months.
Neil Carberry, Chief Executive of the REC, said: “While permanent placements and temp billings still decreased last month across most areas of the country, the pace of decline has slowed hugely as the tide turned on lockdown. With the economy opening up through June and July, we would expect an improving trend in the coming months as firms recover from the worst of the crisis. The fact that demand is now increasing for temporary blue collar and construction workers is also a good sign.
“There are far fewer vacancies in the market than before March, and more people looking for jobs. Recruiters will be key to helping people build confidence and find work – but the reality is that Government needs to help kickstart hiring. Reducing employers’ National Insurance rates would cut the cost of hiring, and a good Brexit trade deal will also support stronger business confidence and investment.”