Review of the UK Jobs Market – December
Welcome to our Review of the UK Jobs Market for December 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.
The main findings were:
- Permanent placements decline again…
- …while temp billings continue to expand modestly
- Softer rise in vacancies, as staff supply declines at weaker rate
Permanent placements fall for third month running
The number of people placed into permanent jobs fell for the third month running at the end of 2022, as increased economic uncertainty , the cost-of-living crisis, low candidate supply and pressure on recruitment budgets all drove the latest drop in placements.
Temp growth remains modest
The number of temporary staff in work increased at the highest rate in 3 months in December. Strong demand for temp workers, and efforts to fill vacancies in a candidate short market plays a part.
Vacancies high, but growth slows again
There was a sustained demand for staff in December. That said, the overall rate of vacancy growth weakened for the ninth straight month and was the slowest seen since the current period of recovery started in February 2021.
Data from ONS pointed to a further fall in overall vacancies in the three months to November. Despite the downward trend, vacancies remain at a historically high level, having peaked at 1,300,000 in the three months to May. Current vacancies stand at 1,187,000
Candidate supply falls at softest pace since March 2021
December experienced a further drop in permanent staff availability across the UK. Worries over the economic outlook had reportedly deterred many people from seeking out new roles in December. A low unemployment rate and skills shortages were also cited as factors limiting the pool of available workers.
The availability of short-term staff fell for the twenty-second month running in December. That said, the rate of decline eased for the fourth month in a row. Temporary labour supply has fallen also due to candidates preferring the security of permanent roles.
Starting salary inflation edges down again in December
Average salaries awarded to new permanent joiners increased again in December, thereby stretching the current period of rising pay to 22 months. That said, the rate of nflation retreated further from March’s all-time record. Greater competition for scarce staff is still having an impact.
Temp wages increase at weakest rate for 20 months
The rate of inflation of temporary rates was the slowest seen since April last year, albeit remained sharp overall.Companies arehving to increase their pay offers due to the rising cost of living and candidate shortages. The sharpest increase was seen in the North of England.
Source: KPMG and REC UK Report on Jobs 10 January 2023
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