Starting salary rates and demand for staff markedly decreased in the UK as business confidence remains subdued.
Permanent staff appointments have fallen for 35 months as employers continue to navigate budgetary restraints, according to the monthly UK Report on Jobs from KPMG UK and the Recruitment and Employment Confederation. The Permanent Placements Index — the report’s main hiring measure — was at 44.2 in August. That’s below the neutral level of 50 but well above the June index reading of 39.1.
UK recruitment consultancies signalled a slower, but still marked, reduction in the number of people placed into permanent jobs, the report said. Although the rate of contraction was the slowest in three months, it was steep overall and often linked to cost concerns.
Overall, the demand for staff continues to fall. Notably, the pace of reduction was the steepest recorded in six months. According to the latest data, vacancies have fallen for 22 consecutive months. Consequently, staff availability rose to pandemic levels, rising from 64.7 in July to 70.1 in August.
Both permanent and temporary candidate numbers rose to levels recorded in late 2020, but the drop was softer for temporary opportunities than for permanent ones.
Low business confidence among employers has affected pay growth for employees. Salaries for newly placed permanent workers increased only slightly midway through the third quarter, the report said. Subsequently, permanent pay growth has plummeted to a four-and-a-half-year low.
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