Employers Upbeat about Growth of Temporary and Permanent Workforce

The Recruitment and Employment Confederationís Industry Research Unit has just published its monthly tracking research results for the last quarter of 2007 which showed continued strong performance and increased employer optimism about growth prospects for both temporary agency workers and permanent staff.

This ëreality checkí provides a welcome counter to some of the more negative recent assessments on the outlook for the UKís labour market.

Summing up the findings, Roger Tweedy, the RECís Director of Research commented: ìDuring this period of uncertainty and heightened economic speculation, it is important to focus on what is really happening on the ground. This research provides an invaluable reference point for recruiters and confirms that 2007 was another good year for the sector.

ìThe feedback from agencies on our Steering Group confirms that this pattern has continued into 2008 with January results ahead of forecast. The uncertainty in the wider economy has certainly not yet hit most recruiters.î

Overall, employers and agencies in 2007 were more optimistic about the demand for temporary agency workers in the next 12 months than they were in 2006. However, concerns remain over the impact of proposed new regulations covering the provision of temporary work in the UK.

Commenting on this, the RECís Director of External Relations Tom Hadley says:ìWe must ensure that any new regulations such as those outlined in the forthcoming Private Members Bill do not hamper the effective provision of temporary work in the UK.

ìThis is especially true in such a delicate economic climate and at a time when temporary work can provide a vital stepping stone into the labour market for key target groupsî.

Headline results from the IRU tracking research:

The tracking research is now the largest database of recruitment knowledge in the UK. It is widely used by government and industry analysts and supported by a steering group of the UKís leading recruitment agencies.

The latest data shows that:

ï 2007 was another excellent year for the sector. Although agencies reported a drop in demand for permanent staff in the last quarter of 2007, employer optimism about future growth prospects actually increased suggesting that the dip is partly seasonal and partly a short-term reaction to general uncertainty about the economy.

ï Overall, employers and agencies in 2007 were more optimistic about the demand for temporary agency workers in the next 12 months than they were in 2006. The only exceptions are the retail and education sectors.

ï The satisfaction levels of agency workers and employer satisfaction with agencies both increased in 2007 from the previous period.

ï Looking at results from the last quarter of the year, the number of agency workers on assignment was comparable to the previous quarter and to the last quarter of 2006.

ï Employers worked with an average of 2.5 agencies in Quarter 4 2007 and the proportion of employers who said they would always use an agency to fill a temporary position increased. The overall satisfaction levels of employers with the service provided by agencies also increased.

ï In the last quarter, employers predicted an increase in the use of agency workers over the next six month. A total of 35 per cent of employers predict that demand would increase ëslightlyí or ëgreatlyí ñ the highest level of optimism recorded by the survey.

ï Agencies report that demand for permanent staff fell in the last quarter. However employers believe that the long-term prospects for permanent jobs are good with most predicting growth in the next 12 months.

The full results from the 2007 tracking programme are being published this month (February 2008). For more information visit: