Temporary billings are rising at the fastest rate for a year, while permanent placement growth dove to a seven-month low, according to the Markit and Recruitment and Employment Confederation’s (REC) Report on Jobs last month.
The report also found that the number of people placed in permanent jobs continued to increase during March. That said, the rate of growth eased to a six-month low. Temporary/contract staff billings on the other hand rose at the sharpest pace in four months. Starting salaries for people placed in permanent jobs continued to rise in March. The rate of growth remained strong, having quickened slightly since February. Hourly rates of pay for temporary/contract staff meanwhile increased at the sharpest pace in three months.
REC director of policy Tom Hadley says, “Over the last quarter permanent hiring has continued to grow, but the rate eased in March to the slowest since September 2015. While we expect jobs growth to continue overall, we are now seeing the effects of current uncertainty in the marketplace on UK employment.
“Global economic headwinds plus uncertainty around a possible Brexit make it likely that slower growth in permanent hiring will remain over the next few months as employers take a wait-and-see approach.
“In contrast, temporary hiring is on the up as businesses seek to meet increasing demand while retaining the ability to react quickly to any threats that might be around the corner.
“We have also seen a continuing increase in both starting salaries for permanent positions and hourly rates for temporary employment – a trend likely linked to the introduction of the National Living Wage.”
It appears that the UK labour market is going through an unsettled time, with the impact of the National Living Wage changing employer behaviour to switch from permanent to temporary hiring along with the uncertainty around a possible Brexit. Because of this, employers are turning to temps and contractors to provide a flexible resource for their businesses, as a way of preparing for any possible change to the UK’s relationship with Europe, and the impact this would have for the UK economy.
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