Member Article

Permanent placements rise above UK average pace in the North

The growth of permanent placements in the North of England is well above UK average as July the latest data signals a twenty-seventh successive monthly increase in permanent staff placements.

The Report on Jobs: North, which contains original data from the survey of recruitment and employment consultants in the North of England, reveals that the rate of expansion of permanent placements remained robust and was the second-sharpest since September.

Growth was strongest in the Midlands, followed by the North of England, both of which saw sharper gains than in the prior month.

The South and London reported comparatively moderate rates of improvement, which were slower than June in both cases.

Chris Hearld, Chair, KPMG in the North, said: “We’re continuing to see an increase in confidence from Northern employers as the demand for permanent employees rises above the national average.

“Meanwhile, with increased political and economic certainty following last month’s Budget it is clear that businesses are doing all that they can to attract and retain talent across the North of England.”

The report shows the growth rate in temp staff billings in the North of England eased sharply to a 27-month low in July, and was surpassed by the national average for the first time since April.

Growth of UK temp billings remained solid in July, albeit the weakest registered for over two years. All of the English regions covered by the survey reported improvements, with the steepest gains in the Midlands and London.

“With increased political and economic certainty following last month’s Budget, it is clear that businesses are doing all that they can to attract and retain talent across the North of England.”

July saw temp/contract staff availability in the North of England decrease for the twenty-second successive month, with one-in-four responding recruitment consultants signalling a deterioration. However, the rate of decline was the least marked since January and moderate in comparison to the UK average.

Recruitment consultants in the North of England reported a further marked deterioration in the availability of permanent candidates. That said, the rate of decline eased sharply to a five-month low and was noticeably less steep than that indicated by the national average.

Permanent staff salaries in the North of England improved for the forty-first successive month in July, although the rate of inflation was weaker than in the prior month, it remained strong and above the national average.

By region, the sharpest rises in permanent pay were seen in the Midlands and the South and the weakest in London and the North.

Temp pay continued to rise at a marked pace in July, albeit slightly weaker than June’s six-month high.

Moreover, the rate of increase was sharper than the UK average for the second successive month. Around 19% of surveyed recruitment consultants in the North of England reported an increase in temporary staff pay, compared to less than 2% signalling a decrease.

Chris continued: “Nevertheless, there is evidently an industry-wide skills shortage as businesses across the North are affected by a lack of both temporary and permanent workers.

“Despite increased economic certainty and a focus on the North following the Government’s Northern Powerhouse announcements, firms continue to struggle to find the talent they need. This may well subsequently affect growth plans, thereby potentially negatively impacting the wider performance of the Northern economy.”

“There is evidently an industry-wide skills shortage as businesses across the North are affected by a lack of both temporary and permanent workers.”

REC Chief Executive Kevin Green, says: “While demand for staff remains strong, the labour market is tightening. Alongside long-term problem areas such as technology and engineering, we’re now seeing vacancies in the North for accountants and drivers being flagged as hard to fill.

“The national shortage of construction workers is a particular concern. If construction companies don’t have the people they need, both infrastructure projects and house building will be constrained, and this will have an impact on wider economic growth.”

This was posted in Bdaily's Members' News section by Ellen Forster .