Jobs growth continued to strengthen in December

Decemberís Report on Jobs survey signalled that growth of permanent staff placements accelerated to a thirty-three month high in December, while temp billings rose at the sharpest rate for four months. Demand for staff continued to strengthen, driving further robust inflation of wages and salaries.

The Report on Jobs, published today by the Recruitment and Employment Confederation and KPMG, provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies and employers, as well as data on national newspaper recruitment advertising.

Commenting on the latest survey results, Michael Carter, People Services Partner at KPMG said:

The figures show a strong start to 2007 with permanent and temporary placements continuing to rise in December, and given that demand is growing at the strongest rate for over two years, this type of activity shows no sign of slowing down.

ìWithin a strong recruitment market, an employer must seek to differentiate itself from its competitors, especially when the figures showed a continued deterioration in the availability of permanent candidates in December.

ìAs part of being an employer of choice, employers should ensure that employees and potential employees are fully informed of the value of their total remuneration package (including salary and all benefits), so that they maximise their own packages and can be sure that potential employees are comparing like-with-like when deciding which opportunity to take.î

Also commenting on the report, Marcia Roberts, Chief Executive Officer, Recruitment and Employment Confederation (REC) said:

ìThe continued demand for staff and ongoing drop in candidate availability once again highlights the important role that migrant workers coming to the UK play in helping to fill some of these vacancies. This is especially timely within the context of discussion regarding the status of workers from the new EU member states ñ Romania and Bulgaria.

ìAt the same time, the increased demand for temporary staff in December once again shows the benefits of a flexible workforce that can help employers cope with seasonal peaks.î

Placements and billings rose at faster rates...

Both permanent staff placements and temporary/contract staff billings rose at accelerated rates in December. The latest expansion in permanent placements was the most marked for thirty-three months, while growth of temp billings reached a four-month high.

...driven by strong demand for staff

Staff appointments were driven higher by a further strong increase in job vacancies during December. Higher levels of demand were recorded for all main categories of employment in both the permanent and temporary sectors.

Drop in candidate availability...

The availability of candidates for permanent jobs continued to deteriorate in December, with the rate of contraction quickening to the sharpest in four months. Meanwhile, temporary/contract staff availability fell for the first time in five months, though the decline was only modest.

...contributed to further robust inflation of wages and salaries

Strong demand for staff and shortages of skilled candidates underpinned a further rise in employee pay during December. Inflation of permanent staff salaries remained close to Novemberís seventy-one month high, while temp pay increased at a robust pace, albeit the least marked for five months.

Latest data from the survey of recruitment consultants highlighted further strong growth of permanent and temporary staff appointments in December. Permanent placements rose at the fastest rate for thirty-three months, while expansion of temp billings hit a four-month high.

Pay pressures are closely related to labour market tightness, as the above data from the survey of recruitment consultants shows. Inflation of permanent staff salaries remained close to Novemberís seventy-one month high in December, while candidate availability fell at an accelerated rate.