MNI DATA: UK Starting Salaries At 41-Month High: REC

--UK August Permanent Placements 56.0 v 57.6 Aug: Markit/REC

By Jai Lakhani

     LONDON (MNI) - UK recruitment agencies saw a continued rise in permanent

staff appointments in September, albeit at a softer pace than in August, as

firms continue to offer higher permanent starting salaries to an increasingly

smaller pool of candidates, the Markit/REC survey released Friday showed. 

     Permanent staff placements dropped to 56 from 57.6 in August -- which was

then the fastest pace since March. However, the reading extended the run of

increasing permanent appointments to 27 consecutive months. 

     Whilst temporary billings moderated to 55.3, the softest since October

2016, it still represents a strong reading. 

     --CANDIDATE SUPPLY CONTINUES TO DROP

     Agencies reported that candidate shortages continued to weigh on staff

appointments. Recruiters reported continued difficulties regarding the

availability of staff for both permanent and temporary roles. Permanent staff

availability deteriorated at a rate below August but still elevated, whereas

temporary labour supply fell at the fastest rate in tem months. 

     A number of panellists blamed this on the low unemployment rate. The

availability of permanent staff index only rose 0.1 points, but the

temporary/contract staff index fell by 2.2 units, with both remaining

substantially below the 50-neutral mark. 

     The availability of permanent staff index picked up to 37.5 in September,

up from 37.4 in August, while the availably of temporary staff index rose fell

2.2 points to 40.3.

     --REMAIN ROBUST 

     Demand for staff slipped a touch in September, with overall job vacancies

expanding at a rate just below its 2-year low. However, vacancies in the

permanent segment remained above 60, at 60.4 and the temporary segment just

below at 59.2. 

     --STARTING PAY UP

     Average starting salaries awarded to newly-placed permanent staff rose to a

41-month high amongst permanent staff and also rose at a faster pace than in the

preceding month in temp billings. 

     Despite the softening of the rate of inflation from previous months,

short-term pay rates also increased -- highlighting strong demand for workers.

Salaries were being demand-pulled upwards with the rate of staff demand

remaining sharp overall. The permanent salaries index rose to a staggering 64.5

from 62.4 previously. Temporary pay rates rose to 58.8 in September from 58.1 in

August. 

     --STRUGGLING TO FILL VOID 

     "UK businesses are resilient but they're struggling to find people they

need to drive growth and opportunity. Recruiters' specialist skills help to

address this, but with Brexit looming to a comprehensive mobility deal with the

EU will be needed to underpin prosperity. Higher skills investment, driven by a

reformed apprenticeship levy, will also be essential," said Neil Carberry, Chief

Executive at REC.

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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