First fall for permanent placements in nearly 4 years

The number of people placed in permanent positions fell in June, while pay growth slowed even further, according to the latest Markit/REC Report on Jobs.

Although slight, it was the first decline in 45 months. Anecdotal evidence suggested that uncertainty in the lead-up to the EU referendum (data were collected between 13–24 June) had heavily impacted on activity.           

London saw a further drop in permanent placements, with the rate of decline the sharpest since December 2012. Scotland saw broadly unchanged placements, while the Midlands and South registered weakening rates of growth. The North posted the strongest increase overall.

Agencies in the South of England reported stagnant temp billings during June, while slower increases were recorded in the Midlands, the North, London and Scotland. Higher demand was signalled for both public and private sector vacancies, with stronger growth indicated for the latter and private sector temporary workers seeing the fastest increase overall.

Engineering staff topped the ‘league table’ in June, recording the strongest growth in permanent vacancies of the nine monitored categories. In second place was nursing, medical and care workers, who saw comfortably the sharpest rise in temporary vacancies during June, with hotel and catering staff in second place. The weakest growth was signalled for executive and professional staff.

Although temporary/contract staff billings continued to increase in June, the rate of growth eased to a 9-month low. Brexit uncertainties were frequently cited by survey respondents.  

Kevin Green, REC Chief Executive, commented on the findings: “Uncertainty during the run-up to the referendum saw many employers suspend permanent hiring and instead bring in temporary, contractor or interim staff to hedge against potential changes to their growth prospects.

“Whilst it is too early to assess what the impact of the vote to leave the EU will be on jobs, our data underlines the need for uncertainty to be minimised so that our economy and our labour market are not adversely affected. The best thing for business right now is clear and calm leadership and as much clarity as possible on what the post-EU future will look like.” 

“Before the referendum, businesses were already finding it increasingly hard to source the right candidates. Ensuring employers can still access the people they need to succeed must now be top of the list in any negotiations.”