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August REC Job Report: Starting salaries go up, as talent acquisition becomes harder

Posted on 26/09/2018 by Krishna Patel

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The August REC report is now out and is bringing good news for those searching for a new role, but not so good news for those recruiting for roles.

 

Key Points:

  • Stronger expansion in permanent placements, but temp billings growth softens
  • Starting salaries increase at second-fastest rate in over three years
  • Staff vacancies continue to rise at historically marked pace

 

Placement rates and staff demand

The rate at which permanent staff placements are being filled has been on the rise continuously, and has risen at the steepest rate, in five months, during August. On the other hand, whilst temporary placements have been increasing too, the rate of increase is slowing and is the ‘softest’ increase recorded since October 2016.

Throughout the month of August, staff demand remained strong with the smallest of falls compared to July. Nonetheless, the steep increase continues in both permanent and temporary placements.

However, the availability of permanent candidates to fill these roles has dropped even further in August as unemployment rates are low. In comparison, ‘temporary worker availability fell at a slightly softer pace.’

It appears as though, due to the large volumes of permanent vacancies but not enough workers to fill them, companies are increasing the average starting salary, it being the second-sharpest increase in over three years. Similarly, pay rates for temporary vacancies have increased too, just not at as sharp of a rate.

 

Regional and sector distinctions

Clear rises in filling permanent roles were recorded across all monitored English regions in August, with London taking the lead. For the filling of temporary roles, it was the Midlands who led the rankings.

Demand for staff rose across both the public and private sectors during August, with the latter noting the fastest increases in job vacancies.’ Demand for permanent placements was highest in the private sector, and the weakest being the rise in search for permanent placements in the public sector.

Out of the ten broad job categories that REC monitors, IT and Computing placed first for permanent job vacancies, like previously. The rest of the categories saw increased demand to, except from retail where vacancies stalled. Blue collar, and hotel and catering, saw the highest demands for temporary placements, with a rise in all other categories except retail again.

 

Neil Carberry, Chief Executive at the REC said:

 

“Businesses are getting on with it driving Britain’s growth – jobs are being created and starting salaries are rising. There are big opportunities out there for candidates right now looking for a new role.

 

“But how long our labour market can defy gravity if the shape of our future trading arrangements with the EU remain unclear is the big question. Companies are starting to implement contingency plans now – and those who aren’t will need to step up progress.

 

“The biggest long-term question on jobs is how they will be affected by new technology and stiff price competition driven by value-conscious consumers. For recruiters, helping people find pathways from sectors like retail into growing sectors will both boost opportunity and address candidate shortages in key sectors.”

 

Read full article here:

https://www.rec.uk.com/news-and-policy/press-releases/staff-placements-rise-further-while-candidate-shortages-fuel-higher-starting-salaries