Labour market slide starts to slow
8 Apr 09
Job vacancies are still falling but the rate of decline is slowing, according to a report from KPMG and the Recruitment and Employment Confederation
The latest Report on Jobs signals an easing in the pace of labour market deterioration, with employment and pay decreasing at weaker rates. KPMG, the report’s co-sponsor, warns however that the job situation remains bleak.
Craig Anderson, head of KPMG in Scotland said: “While some observers might see small upturns in all these indicators as evidence of green shoots of recovery, the reality is that the availability of permanent and temporary jobs in the UK continues to decline, salaries are being reduced and the pool of available candidates is rising further. These latest figures leave no doubt that the UK jobs market is at its worst in the 11 year history of the survey and recovery might take longer and be more protracted than many hope.”
Although recruitment consultancies continued to register falling volumes of permanent and temporary appointments in March, the rates of decline eased to the weakest in six and five months respectively.
Lower reductions in employment reflected a moderation in the pace of contraction of demand for staff in March. Permanent staff vacancies fell at the slowest rate since last November, while the latest drop in demand for short-term workers was also the least marked in four months.
The availability of staff to fill vacancies was reported to have improved again in March, in line with widespread redundancies and fewer new job opportunities. Permanent candidate availability rose at the third-fastest rate since the start of the research series, while temporary/contract staff availability increased at a survey record pace.
Permanent staff salaries and temporary/contract staff hourly rates continued to fall in March. Panellists commented that higher candidate availability and stretched client budgets had placed downward pressure on pay. However, the latest declines in permanent and temporary pay were slightly weaker than February’s records.
Kevin Green, Chief Executive of the REC, said: “These figures are an improvement on the last six months. They indicate the pace of deterioration in the jobs market is easing and this rings true with what recruitment businesses are seeing on the ground.
"However, we anticipate that we have not yet reached the bottom. With unemployment still set to increase over the coming months, we are calling on the Government to ensure that this month’s Budget is focused on retaining and creating jobs. To this end, we are writing to the Chancellor today with our five point plan to jump-start the jobs market.”
The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs draws on original survey data provided by recruitment consultancies to provide an overview of the UK labour market.