Skip to main content
Recrutiment & Employment Confederation

Report on Jobs: Starting salaries continue to rise at near-record pace amid sharper drop in candidate supply

Press releases

Key findings

  • Substantial increases in permanent placements and temp billings
  • Pay pressures remain elevated as candidate availability falls rapidly
  • Overall vacancy growth eases, but remains sharp

Data collected January 12-25


The latest KPMG and REC, UK Report on Jobs survey signalled a further steep increase in hiring activity at the start of 2022. Permanent placement growth eased slightly since December, however, while the upturn in temp billings gathered pace.

The overall availability of candidates deteriorated at a quicker pace in January, driven by a steeper fall in permanent staff supply. Robust demand for workers and scarce candidates led to further marked upward pressure on rates of starting pay. Starting salaries increased at the third-fastest pace on record, while temp pay growth remained sharp despite easing to a seven-month low. Vacancies data meanwhile showed that demand for workers continued to rise at a historically sharp pace, despite overall growth edging down to its lowest for nine months.

The report is compiled by IHS Markit from responses to questionnaires sent to a panel of around 400 UK recruitment and employment consultancies.

Recruitment activity continues to rise sharply at start of 2022

The easing of pandemic restrictions, improved market confidence and strong demand for workers drove a further steep increase in recruitment activity across the UK during January. Permanent placement growth remained sharp, despite easing to a three-month low, while temp billings expanded at the quickest rate since last August.​​​​​​​

Starting salary inflation remains close to record pace

Robust demand for staff and candidate scarcity drove up rates of starting pay for both permanent and temporary staff at the start of the year. Starting salaries rose at the third-sharpest rate on record (since October 1997), beaten only by those seen last October and November. Temp wage inflation also remained rapid, despite the pace of increase easing to a seven-month low.

Quicker fall in overall supply of candidates

The rate of decline in overall candidate availability quickened for the first time in five months in January. Though not as steep as those seen during last summer, the rate of deterioration remained substantial overall. The downturn was driven by a quicker drop in permanent staff supply, as temp candidate numbers fell at a softer pace.

Vacancy growth eases, but remains historically sharp

Demand for staff continued to rise at a historically sharp pace in January, despite growth of overall vacancies edging down to a nine-month low. Underlying data showed that the softer upturn was due to a weaker rise in permanent staff demand, as short-term vacancies expanded at a quicker rate.

Regional and Sector Variations

The steepest increase in permanent staff appointments was seen in the South of England, though rates of expansion softened across all four monitored English regions.

All four monitored English regions saw sharper increases in temp billings in January, bar London. The quickest rate of growth was seen in the North of England.

Demand for staff continued to rise sharply across both the private and public sector during January. The quickest increase in vacancies was signalled for permanent roles in the private sector, while the softest was seen for temporary workers in the public sector.

Demand for permanent workers rose across all ten monitored job sectors at the start of 2022. The quickest increase in demand was seen for IT & Computing, followed by Nursing/Medical/Care. The slowest upturn in vacancies was seen in the Retail sector.

The increase in demand for temporary staff was also broad-based across all ten monitored sectors in January. The quickest expansions were seen in the Nursing/Medical/Care, Blue Collar and Hotel/Catering categories.


Commenting on the latest survey results, Neil Carberry, Chief Executive of the REC, said:

"The jobs market is still growing strongly at the start of 2022. Recruiters are working hard to place people into work as demand from employers continues to rise. With competition for staff still hot, companies are having to raise pay rates for new starters to attract the best people. And the cost of living crisis means there is also more pressure from jobseekers who want a pay rise. But pay is not the only important factor - companies must think about all aspects of their offer to candidates to ensure they get the staff they need. This will be important as firms’ spending is under pressure from inflation as well.

"Government's role is to manage inflation, but also to ensure that they do not discourage investment - that is what will drive the economy to grow through this year. Now is the wrong time to be raising National Insurance, the biggest business tax. But politicians should also be thinking about longer-term workforce planning, making sure we have the skills the country needs for the future. This will take a collaborative effort between the public and private sectors, and the recruitment industry stands ready to help."

Claire Warnes, Head of Education, Skills and Productivity at KPMG UK, said:

“The new year has seen the jobs market continuing where it left off, with a steep climb in permanent and temporary hiring. Meanwhile, a sustained decline in the number of suitable candidates has pushed starting salaries up for yet another month.

“It will be important to monitor how these dynamic features of the job market respond to the competing pressures being felt by both businesses and candidates – the desire to make the most of the reduction in Covid restrictions on the one hand; and the understandable concern over the cost of living and inflationary rises on the other.

“Some sectors are continuing to show the strain of high demand for permanent and temporary roles. In particular, the IT and Computing, and Nursing, Healthcare and Medical sectors saw the greatest vacancy increases for yet another month, reflecting the significant workforce and skills challenges which these sectors have faced, and which the pandemic has accelerated.”



For more information and interview enquiries, contact the REC Press Office on 020 7009 2192, 020 7009 2157 or Outside of regular office hours, please call 07702 568 829.

For further information on the survey methodology, or for full reports and historical data from the Report on Jobs, please contact

If you are a recruitment business and interested in joining the Report on Jobs survey panel, you can sign up here. By joining the panel, you will get free access to the full Report on Jobs each month.


The intellectual property rights to these data are owned by or licensed to IHS Markit and/or its affiliates. Any unauthorised use, including but not limited to copying, distributing, transmitting or otherwise of any data appearing is not permitted without IHS Markit’s prior consent. IHS Markit shall not have any liability, duty or obligation for or relating to the content or information (“data”) contained herein, any errors, inaccuracies, omissions or delays in the data, or for any actions taken in reliance thereon. In no event shall IHS Markit be liable for any special, incidental, or consequential damages, arising out of the use of the data. IHS Markit is a registered trademark of IHS Markit Ltd and/or its affiliates.