Tag: Jobs report

Downturn in permanent hiring activity eases during December

Royal Bank of Scotland report on jobs 

  • Recruitment activity falls for the third month running
  • Growth of demand for labour softens during December
  • Starting salaries rise at quickest pace since June

According to the latest Royal Bank of Scotland Report on Jobs survey, Scottish recruiters reported a decline in permanent placements during December. The rate of contraction eased considerably over the month, however, with the respective index climbing from 40.6 in November to 46.8 in December.

Nevertheless, placements fell for the third month running overall, as recession fears and market uncertainty dampened recruitment activity. Temp billings likewise fell for the third successive month. Growth of demand for labour continued to soften during the final month of the year.

Permanent and temp vacancies expanded at the weakest rates in 22 and 27 months, respectively. Nonetheless, in efforts to attract and secure candidates amid ongoing reports of labour shortages, firms across Scotland continued to raise starting salaries and temp wages sharply.

Softer reduction in permanent placements

The number of permanent staff appointments across Scotland fell in December, thereby extending the current run of contraction to three months. The downturn eased from November’s 29-month record, but was nonetheless solid overall. According to panellists, reduced market confidence and the cost of living crisis weighed on recruitment.

Though strong, the reduction in permanent placements across Scotland was softer than the UK-wide average.

For the third month running, recruitment consultancies across Scotland reported a decrease in billings received from the employment of short-term staff during December. Adjusted for seasonality, the Temporary Billings Index ticked down from November, to signal a quicker rate of contraction, albeit one that remained mild overall. Skill shortages and difficulties sourcing candidates were in part blamed for the latest decrease.

While a further reduction in temp billings was recorded across Scotland at the end of 2022, the UK as a whole registered a modest expansion.

Marked fall in permanent labour supply in December

The availability of candidates to fill permanent positions across Scotland worsened for the twenty-third consecutive month during December. Although easing from November, the rate of decline remained marked overall and among the fastest on record. Acute skill and candidate shortages limited the supply of workers, according to recruiters. Furthermore, the cost of living crisis, recession fears and greater market uncertainty also restrained labour movement.

The pace of reduction in permanent candidate availability across Scotland outstripped the UK-wide average.

As has been the case in each of the last 22 months, Scottish recruiters reported a fall in temp candidate numbers during December. The rate of reduction gathered pace for the third month running and was the sharpest since June. The latest reduction in temp staff availability was attributed to a slowdown in market conditions, Brexit and a general scarcity of labour.

Starting salaries rise rapidly in December

December data revealed another sharp rise in starting salaries awarded to permanent joiners during December. Notably, the pace of growth continued to quicken from October’s 16-month low, with the latest upturn the steepest since June and above the historical average. According to anecdotal evidence, labour and skill scarcity continued drive up salaries.

Starting salaries across Scotland rose at a much faster pace than that recorded at the UK level.

Pay rates for temp staff across Scotland rose during December, thereby stretching the current run of wage inflation to 25 months. While the rate of growth eased slightly from November, it remained stronger than the survey average and signalled a sharp rise in hourly wages overall. Recruiters indicated that companies raised their pay rates as part of efforts to attract staff amid ongoing labour shortages.

As was the case with permanent starting salaries, temp wages across Scotland grew at a much stronger rate than that seen across the UK as a whole.

Growth of demand for permanent staff eases in December

Growth of demand for permanent staff moderated for the eighth successive month during December. Though strong, the latest upturn was the softest seen since the current run of expansion began in February 2021. Moreover, the rate of increase was weaker than the survey average.

The strongest upturns in demand for permanent staff were seen across the Nursing/Medical/Care and IT & Computing sectors.

Scottish recruiters reported a marked slowdown in growth of demand for temp staff during December. Notably, the respective seasonally adjusted index fell to its lowest level in 27 months and pointed to only a marginal rate of growth.

Of the eight monitored sectors, IT & Computing reported the strongest increase in demand, with Nursing/Medical/Care ranking second.

Sebastian Burnside, Chief Economist at Royal Bank of Scotland, commented: “The final Report on Jobs survey of the year concluded with a further downturn in hiring activity across Scotland, with recruiters noting a third monthly contraction in both permanent placements and temp billings.

“According to panel members, greater market uncertainty and fears over a recession led clients to maintain a cautious approach to staff hiring at the end of 2022. Demand for labour also softened, adding to the likelihood that challenges across the labour market will persist as we enter the new year.

“Nonetheless, with difficulties sourcing suitable candidates, firms continued to raise rates of starting pay. Thus, the data overall suggest that firms are becoming more selective and guarded with their hiring decisions, but willing to offer competitive pay to candidates to secure them.” 

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Royal Bank of Scotland Jobs report shows permanent placements increase in September, but growth “mild”

  • Fresh uplift in permanent staff appointments, but growth only mild
  • Temp billings rise at quicker pace
  • Pay pressures ease, but remain historically sharp

Scotland’s labour market saw an improvement in overall hiring activity in September, according to the latest Royal Bank of Scotland Report on Jobs survey, with recruiters reporting a fresh rise in permanent placements and stronger temp billings growth.

The seasonally adjusted Permanent Placements Index rose back above the neutral 50.0 mark, rising from 47.3 in August to 52.7 in September, to signal a mild uplift in permanent staff appointments, while temp billings increased at a strong and accelerated rate. 

At the same time, sustained growth of vacancies, combined with another deterioration in candidate availability, led to further upwards pressure on pay. Notably, both starting salaries and temp wages increased at historically sharp rates, despite easing since August.

Permanent placements return to growth

Adjusted for seasonal variation, the Permanent Placements Index rose back above the neutral level of 50.0 in September to signal a fresh rise in permanent staff appointments across Scotland. Panellists attributed the upturn to strong demand for staff and increased hiring activity amongst clients in some sectors. That said, the pace of increase was only mild.

September data pointed to sustained growth of temp billings across Scotland, extending the current sequence of upturn that began two years ago. The rate of expansion ticked up from August’s seven-month low and was solid overall.

The pace of increase in temp billings in Scotland was broadly in line with the trend seen for the UK as a whole.

Further marked drop in permanent candidate availability

The supply of permanent staff across Scotland continued to decrease in September, stretching the current sequence of contraction to 20 months. Skills shortages and high demand for staff reportedly drove the latest fall. Notably, the rate of decline quickened slightly on the month and was marked overall.

Scotland recorded a much sharper fall in permanent staff supply than that seen on average across the UK, with the pace of decline slowing slightly on the month at the national level.

Adjusted for seasonal variation, the Temporary Candidate Availability Index remained below the neutral 50.0 mark in September, signalling a nineteenth straight monthly deterioration in the supply of temp staff across Scotland and one that was rapid overall. Panellists cited strong demand for short-term workers and a reluctance among candidates to move roles. Although it remained much sharper than that seen at the national level, the pace of contraction was the slowest for six months.

Rate of starting salary inflation eases to 15-month low

September data signalled a sustained uplift in salaries awarded to permanent new joiners in Scotland, amid reports that strong demand for staff led to upwards pressure on pay. Though historically sharp, the rate of salary inflation was the slowest for 15 months, and weaker than that recorded for the UK as a whole.

A twenty-second monthly increase in hourly rates for short-term staff in Scotland was recorded in September. According to survey respondents, skills shortages were the primary cause of the latest rise. The rate of temp wage inflation softened to a four-month low, but was nonetheless sharp and outpaced the UK-wide average.

Permanent vacancies rise at slower rate

As has been the case in each month since February 2021, demand for permanent staff in Scotland increased in September. The rate of expansion was the softest seen for a year-and-a-half, albeit sharp by historical standards.

IT & Computing recorded the fastest rise in permanent vacancies, followed by Nursing/Medical/Care, while Hotel & Catering saw the slowest.

Temporary vacancies across Scotland continued to rise in September, extending the current sequence of growth to two years.  The rate of increase was the slowest since February 2021, but still sharp overall.

Across the monitored sectors, demand for temp staff was strongest in IT & Computing, followed by Accounts & Financial.

Sebastian Burnside, Chief Economist at Royal Bank of Scotland, commented: “Permanent staff appointments across Scotland rose during September following a moderate fall in August, amid reports of improved hiring activity at clients in some sectors and strong demand for workers.

“The rate of growth was only mild, but nonetheless outpaced the UK-wide average. Temp billings also increased, with growth ticking up since August to a solid pace.

“The imbalance between staff demand and supply continued to place upwards pressure on pay in September.

“The latest survey showed that both permanent and temporary staff availability continued to decline sharply, which drove further increases in temp pay and starting salaries at rates seldom seen in the history of the survey.”

Royal Bank of Scotland Report on Jobs

Permanent staff hires fall for first time in 20 months

  • Permanent placements fall for the first time since December 2020
  • Temp billings growth softens to seven-month low
  • Sustained pressure on pay amid candidate shortages 

August data revealed a renewed fall in permanent staff hires across Scotland, according to the latest Royal Bank of Scotland Report on Jobs survey.

The seasonally adjusted Permanent Placements Index fell below the 50.0 no-change mark, to signal a modest drop in permanent staff appointments that ended a 19-month period of expansion. Growth in temp billings meanwhile moderated to a seven-month low in August. According to panellists, skills and candidate shortages weighed on hiring activity.

However, some recruiters also noted that an economic slowdown and rising market uncertainty added to the loss of momentum across the Scottish labour market. At the same time, demand for staff continued to rise, which drove further increases in both starting salaries and hourly wages. 

Permanent placements fall for first time since December 2020

Scottish recruiters reported a fall in permanent staff appointments during August, thereby ending a 19-month period of expansion. Anecdotal evidence suggested that the contraction stemmed from a slowdown in market conditions and candidate shortages.

Though only modest, the reduction in Scotland contrasted with the trend seen across the UK as a whole, which saw a slightly quicker increase in permanent placements in August.

Temporary staff billings across Scotland increased for the twenty-fourth successive month during August. Though solid, the rate of expansion eased to the slowest since January and was below its long-run average. The uptick in temp billings was in part attributed to increased activity at clients. Where a reduction was reported, panellists cited, lingering COVID-19 impacts and rising economic uncertainty.

Moreover, the rate of increase in Scotland was weaker than that seen across the UK as a whole.

Decline in permanent candidate availability weakest since March

August data highlighted a further reduction in the supply of permanent candidates across Scotland. The respective seasonally adjusted index has now posted below the neutral 50.0 threshold for the nineteenth month running. Acute skill and candidate shortages were linked to the latest decline.

However, though the extent to which permanent staff availability contracted was the slowest in five months, it remained sharper than the UK-wide trend.

The availability of candidates to fill temporary roles in Scotland continued to decline during August, stretching the current run of contraction that began in March 2021. However, the rate of deterioration eased for the third month running and was the slowest since March.

Compared to the UK-wide average, Scotland registered a faster fall in temp candidate availability for the fifth successive month.

Starting salary inflation remains elevated in August

Recruitment agencies across Scotland reported a twenty-first consecutive monthly rise in salaries awarded to new permanent joiners during August. The rate of starting salary inflation quickened fractionally from July and was sharp, albeit the second-softest in 13 months. According to Scottish recruiters, labour shortages drove up salaries.

However, Scotland continued to record a softer rate of increase in starting salaries than that seen at the UK level.

August data revealed yet another sharp increase in average hourly pay for short-term staff across Scotland. The latest uptick extended the current run of expansion to 21 months. Moreover, the rate of growth picked up from July and was the second-fastest since December 2021. According to anecdotal evidence, firms continued to raise wages to attract workers amid labour and skill shortages.

Temp pay also increased at a quickened rate at the UK level during August, albeit one that remained weaker than that seen in Scotland.

Softest increase in demand for permanent staff for 17 months

Adjusted for seasonal variation, the Permanent Vacancies Index posted above the neutral 50.0 level to signal a nineteenth successive monthly increase in demand for permanent workers across Scotland during August. Though sharp and well above the series average, the rate of growth was the weakest since March 2021.

Of the eight monitored sectors, Nursing/Medical/Care saw the strongest upturn in permanent staff vacancies, followed by IT & Computing.

Demand for temporary staff in Scotland rose for the twenty-third month in a row during August. The respective index indicated a strong increase demand overall that was unchanged from July. Notably, the rate of expansion continued to outpace that seen across the UK as a whole.

Engineering & Construction recorded the fastest rise in temp vacancies across the monitored sectors, followed by IT & Computing.

Sebastian Burnside, Chief Economist at Royal Bank of Scotland, commented: “Since April, growth in permanent placements had softened, and now the latest data finally recorded the first fall in permanent staff hires in 20 months during August.

“A loss of momentum was also observed for temp billings, which rose at the softest pace since January. The weaker trends were accompanied by reports that rising economic uncertainty had limited recruitment activity.

“Moreover, labour supply and demand imbalances persisted. Acute skill and labour shortages weighed on the availability of candidates, while demand for labour continued to rise, albeit not as quickly as earlier in the year.

“With firms competing for labour, this resulted in further steep increases in starting salaries and temp wages during August.”

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