Pay pressures continued to strengthen in February

Februaryís Report on Jobs survey signalled an intensification of pay pressures, driven by continued strong growth of demand for staff and shortages of skilled candidates. Meanwhile, further robust increases in permanent and temporary staff employment were recorded.

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.

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

ìThis monthís continued acceleration in pay is more grist to the mill for the interest rates hawks on the Monetary Policy Committee. However, there are also some tentative signs that demand for staff may be starting to ease, in which case pay pressures themselves should also start to lessen. The MPC needs to tread cautiously from here.

ìAs skills gaps continue to widen, employers need to ensure that this information is fed through to skills training and planning organisations, such as the Learning and Skills Council, to ensure funding and training is focused on areas of future need. Employers must continue to articulate that recruits need employability skills such as a strong work ethic, the ability to communicate and work with others, effective time management and that they are willing to learn.î

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

ìItís interesting that this monthís report finds that temporary and contract staff pay rose at the sharpest rate for twenty-seven months. This challenges recent TUC claims that employers are using temporary workers as a source of cheap and vulnerable labour.

ìWith demand for staff continually high, itís vital that the job opportunities that temporary and contract work provide are not limited by unjustified regulation. Although last weekís proposed Private Members Bill did not pass its second reading, it is important that the industry remains on the front foot to ensure that any European Directive on Agency Work does not limit these opportunities.î