Review of the UK Jobs Market – January

Review of the UK Jobs Market – January

Welcome to our Review of the UK Jobs Market for January 2022. Each month, we share market insight on the state of the UK jobs market.

You can either read our short blog, or see our infographic.

Starting salaries continue to rise at near-record pace amid sharper drop in candidate supply

The main findings for January were:

  • Recruitment activity continues to use sharply at start of 2022
  • Starting salary inflation remains close to record pace
  • Quicker fall in overall supply of candidates
  • Vacancy growth eases, but remains historically sharp

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Staff Appointments

Softest increase in permanent placements for three months

January signalled the eleventh consecutive monthly rise in permanent staff appointments. Improved confidence around the outlook and great vacancies have supported the latest increase. However, though sharp, the rate of growth eased to a three-month low.

Quickest rise in temp billings since August 2021

January signalled a sustained rise in placements of short-term/contract staff. This has been on the increase for 18 consecutive months now. The rate of expansion was the quickest seen since last August!

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Vacancies

Vacancy growth eases for sixth month in a row

January saw an increase in overall vacancies for the twelfth consecutive month. Although sharp, the rate of expansion was the slowest seen since April 2021. The upturn in vacancies was supported by strong demand for both permanent and temporary staff, with the former noting the steeper rise.

The total number of vacancies now sits at 1,247,000. This means that vacancies have more than doubled (+109.2%) compared to the final quarter of 2020.

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Staff Availability

Sharper fall in overall candidate availability

January saw a further rapid decline in overall candidate supply. The steeper drop in candidate numbers was driven by a faster fall in permanent staff availability, as contract labour supply fell at a softer pace.

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Pay Pressures

Rate of starting salary inflation holds close to record peak

As has been the case since March 2021, salaries awarded to new permanent starters increased in January. Higher starting salaries are overwhelmingly linked to greater competition for scarce staff and ongoing skills shortages.

Temp pay rises at softest rate for seven months

January saw a sustained rise in pay rates for contract workers. Robust demand for workers and candidate shortages were cited as having driven the latest upturn in contractor day rates.

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January report

Source: KPMG and REC UK Report on Jobs February 2022

Information, Intelligence 15 February 2022 Written by Marketing