Permanent starting salaries rise at record pace
There was a record rise in permanent salaries in the Midlands in July amid a combination of sharp growth in demand for staff and a marked deterioration in the supply of candidates.
A further steep expansion in permanent placements was also recorded, while the rate of growth in temporary billings accelerated to the fastest since March.
The latest KPMG and REC, UK Report on Jobs: Midlands shows that although softening from the record pace seen in June, the rate of growth in permanent placements in the Midlands remained rapid at the start of the third quarter of the year.
Recruitment consultancies indicated that placements had risen in line with greater demand for staff following the reopening of the economy.
The increase in permanent placements in the Midlands was slightly slower than that seen at the UK level. All four English regions saw permanent placements increase strongly, with the fastest expansion in London. The softest rise was in the South of England.
Growth of temp billings at four-month high
July data pointed to a sharp increase in temporary billings in the Midlands, with the rate of expansion accelerating to the fastest since March. Some respondents suggested that temps had been hired given some difficulty in sourcing permanent candidates. The rise in temp billings in the Midlands outpaced the UK average. As was the case with permanent placements, London posted the steepest increase in temporary billings, with the South of England seeing the least marked expansion.
Permanent vacancies increased at a considerable pace in the Midlands during July, with the rate of growth ticking down only slightly from June’s record. In fact, the rise was the second-fastest since the series began in October 1997.
A similarly strong rise in demand for temporary staff was signalled at the start of the third quarter. Furthermore, the rate of expansion quickened for the sixth month running and was the fastest since March 1998.
Steep decline in permanent candidate numbers
The Midlands saw a further substantial reduction in the supply of permanent candidates during July, with the rate of decline strengthening slightly to the most marked since August 2015. Anecdotal evidence suggested that people currently in jobs were reluctant to move at present given high levels of uncertainty. Close to 55% of recruitment consultancies signalled a reduction in permanent staff availability. Steep reductions in permanent candidate numbers were seen across all four monitored UK regions, with the sharpest fall in the South of England.
Near-record fall in temporary staff availability
Recruitment consultancies indicated that temporary candidate numbers decreased at a rapid pace in July. The pace of reduction was the sharpest since March 2015 and one of the strongest on record. A number of respondents indicated that Brexit had been a factor behind the drop in temporary staff numbers. The Midlands registered the most marked deterioration in temp candidate supply, with the softest decline in London.
Record rise in permanent salaries
Permanent salaries for new joiners in the Midlands increased at the fastest pace in the survey’s history in July, with the rate of inflation surpassing the previous record seen in November 2014. A combination of rising demand for staff and a lack of suitable candidates was behind the increase in permanent salaries.
All four English regions also saw permanent salaries rise at unprecedented rates, with the sharpest increase seen in the Midlands.
Temp wages surge higher
As was the case with permanent starting salaries, pay rates for temporary staff rose sharply during July. The rate of inflation was the fastest in just over 23 years, and one of the strongest since the survey began in October 1997. Recruitment consultancies indicated that candidate supply shortages had been the principal factor leading to higher pay rates. Around 40% of respondents indicated a rise in temporary wages, with the remainder seeing no change.
The Midlands recorded the steepest increase in temp pay, closely followed by the South of England and North of England. The softest pace of inflation was signalled in London.
