The number of permanent staff appointments made by UK recruitment consultancies increased again in March, with growth picking up to the strongest level since October 1997.

This increase was underpinned by a further expansion of permanent staff vacancies, albeit the slowest in three months, according to the Recruitment and Employment Confederation (REC) and KPMG’s Report on Jobs.

Recruitment consultants signalled another improvement in the availability of staff during March. The supply of both permanent and temporary/ contract candidates increased at slightly faster rates compared with one month previously.

Demand in growth was broad-based across all eight categories of permanent staff monitored by the survey in March. IT & computing workers were the most sought after, rising to 65.1 index points [with 50 equalling no change] followed closely by demand for executive/professional staff on 63.8 points. Hotel & catering continued to record the slowest growth, registering 52.9.

Growth of short-term staff appointments quickened to the strongest for 34 months in March. Billings were driven higher by the fastest increase in demand for temporary staff since January 2008.

On the temporary/contract staff side, the secretarial/clerical sector remained the most in-demand during the latest survey period on 59.9 index points. Coming a close second at 58.5, IT & computing also performed well in the temporary category, rising from its sixth place in March 2009 with a marked increase in vacancies. In contrast to its strong performance in the permanent category, the slowest rate of expansion was for executive/professional staff, registering 53.7.
Permanent staff salaries rose again in March. The rate of pay inflation was solid, despite easing slightly from February’s 20-month high. Temporary pay increased at a pace that, although modest, was the sharpest since June 2008.

Bernard Brown, partner and head of business services at KPMG, said: “The UK jobs market seems to be going from strength to strength. These figures show that private sector confidence is returning. However, a lot of the hiring activity is going on in the public sector. The public sector recession, which is on the cards, hasn’t hit the jobs market yet, but when it does, the upwards trend we have seen over the last couple of months may come to a halt.”

Kevin Green, chief executive of the REC, said: “A rise in both temporary and contract work at the sharpest rate for nearly three years shows how they continue to provide vital flexibility for UK firms, as well as a valuable route back into work for jobseekers.

“However, deep-rooted reforms and innovative approaches to public sector resourcing will be needed to maintain frontline services. While high-end sectors such as IT and engineering continue to show strong growth, demand is also increasing for secretarial and back-office support roles.”
Research produced by Markit Economics on behalf of the rec and kpmg

Key indicators

• Strongest growth of permanent placements since October 1997
• Temporary/contract staff billings rose at sharpest rate for 34 months
• Further rise in candidate availability