Review of the UK Jobs Market – July
Welcome to our Review of the UK Jobs Market for July 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.
Hiring activity growth slows again in July amid increased economic uncertainty
The main findings were:
- Softer expansion in overall recruitment activity
- Vacancy growth dups for 16-month low
- Availability of candidates falls at softer, but still sharp rate
- Starting pay inflation eases only slightly
Permanent placement growth weakens again in July
Greater demand for staff and company expansions helps to drive permanent placements higher. However, growth was constrained by low candidate numbers, softer rise in vacancies, and delayed decision-making around new hires due to rising costs and economic uncertainty.
Softest increase in temp billings for 17 months
Placement of temporary workers has now risen each month for the past 2 years. Growth is due to robust demand for short-term staff, with some companies preferring temp staff over permanent workers, but also the limited availability of permanent contracts.
Demand for staff increases at slower rate
The rate of expansion for permanent and temporary vacancies weakened for the third month in a row, and was the slowest seen since March 2021. The strongest increase in vacancies was signalled for permanent roles in the private sector, while the softest rate was for permanent roles in the public sector.
Overall, vacancies numbers have remained broadly stable over the second quarter. At 1,294,000, there has been a slight reduction, but this is still almost 50% higher than vacancies numbers reported this time last year.
Staff supply falls at softest rate since April 2021
The availability of permanent staff decreased in July, as has been the case for the last 18 months. However, it wasthe least severed since April 2021. A general shortage of skills, and people being more hesitant to seek or switch roles due to greater economic uncertainly. The downturn in temp labour supply was also the weakest seen since March 2021. Temp numbers are still declining due to a combination of ongoing labour shortages, Brexit, and a preference among candidates for permanent roles.
Starting pay for permanent staff continues to rise sharply
Starting salaries for permanent workers continued to increase in July. The rate of growth was rapid, albeit the softest seen since August 2021. Higher pay is being linked to lower candidates numbers, intense competition for staff and the rising cost of living.
Temp wage inflation edges down to 13-month low
The increased cost of living and candidate shortages drove a further rise in average hourly rates for short-term staff in July. Temp pay has now risen continuously since March 2021. The South of England recorded the fastest increase.
Source: KPMG and REC UK Report on Jobs 05 August 2022
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