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Recrutiment & Employment Confederation

Permanent Placements Growth Accelerates to Fastest Since Last July

Press releases

Key points: 

  • Stronger rise in permanent placements contrasts with softer temp billings growth
  • Starting salary inflation hits 31-month record amid growing candidate shortages
  • Growth of demand for staff edges down slightly but remains marked



The IHS Markit/REC Report on Jobs – published today – provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies.  

Sharper increase in permanent placements...


Recruitment consultants signalled a marked rise in permanent staff placements in January, with the rate of expansion the joint-steepest since April 2015. In contrast, growth in temp billings softened to a ten-month low, but was sharp overall.

...supported by further marked increase in job vacancies


Overall demand for staff continued to rise sharply in January, despite growth of demand softening to a 13-month low. Notably, both permanent and temporary staff vacancies continued to rise at historically marked rates.

Starting salary inflation quickens to 31-month record...


Starting salaries for successful permanent candidates increased at the fastest pace for over two-and-a-half years at the start of 2018. Meanwhile, growth in temp pay eased to the joint-weakest in ten months, but remained sharp overall.   

...amid steep drop in candidate availability

The number of candidates available to fulfil permanent and temporary roles continued to contract at historically sharp rates in January. This was despite rates of contraction softening slightly in both cases compared to December. 

Regional variation

Data broken down by region showed that the North of England saw the fastest increase in permanent placements, though rates of growth were also sharp in the other four monitored regions.
The Midlands saw by far the quickest increase in temp billings, while growth was also sharp in the North and South of England and London. Meanwhile, Scotland registered a modest upturn following a reduction in December.


Sector variation


Stronger demand for staff was led by the private sector in January, according to latest survey data. 

In the private sector, permanent staff vacancies rose at a sharp and accelerated pace in January. Demand for temporary workers across the private sector also rose strongly, despite growth softening since December. Meanwhile, permanent staff vacancies stagnated in the public sector, and the number of temporary staff roles declined slightly. 

All nine types of permanent jobs monitored by the survey saw improved levels of demand for staff at the start of 2018. IT& Computing led the overall rankings, following closely by Engineering and Accounting/Financial. 

Hotel & Catering was the most in-demand category for temporary/contract staff in January. Growth of demand was also sharp for Blue Collar and Nursing/Medical/Care workers. Construction registered the softest increase in vacancies.

Kevin Green, REC Chief Executive says:


“We are seeing a continued rise in jobs filled via recruiters as it gets more challenging for businesses to find candidates. The UK has almost full employment and the country is plagued by labour, skills and talent shortages. This increasing competition for good quality staff is driving up starting salaries with employers willing to pay higher wages to attract the right people. So, it’s a good time to move jobs, especially as employers aren’t increasing wages for their existing workforce.

“It’s reassuring that demand for permanent staff remains strong despite the economic uncertainties. However, there is a slight slowdown in the growth of temporary placements. This could be an early sign that employers are hesitating. 

“The struggle to find appropriate candidates will get worse. We are therefore asking for a balanced and evidence-based immigration system. Businesses urgently need to invest in the upskilling of their workforce. The government can help by turning the Apprenticeship Levy into a broader training levy. It’s time they put the concerns of UK businesses at the top of their agenda.”