Market update – Report on Jobs: Placements rise further, but candidate shortages fuel higher starting salaries

The latest REC report on jobs, published today and drawing on original survey data provided by recruitment consultancies has shown strong evidence of continued resilience in the UK labour markets

 

A summary of key points from the report highlights: 

  • Stronger growth in permanent placements
  • Starting salaries increasing at second-fastest rate in over three years
  • Vacancies continue to rise at historically marked pace

 

Permanent staff placements rose at the steepest rate for five months in August. This was buoyed by a further sharp rise in vacancies amid increased demand for talent throughout August.

The effect of this demand is resulting in permanent starting salaries rising at a sharper pace than almost any time in the last three years.

This has also been driven by a further lack of availability of talent in August, with a low unemployment rate being blamed, resulting in the need for more proactive candidate sourcing

These trends have been observed across the UK market with little regional variation, meaning the Midlands markets are showing a robust outlook in demand, higher starting salaries and reduced candidate availability.

 

Neil Carberry, Chief Executive at the REC commented:

“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.

 

Paul O’Hara, MD of Churchill Howard commented:

Permanent starting salaries have taken a big leap forward, from newly qualified accountants making their first move into industry from practice right through to board level appointments.

Employers are desperate to retain their people, knowing how hard it can be to find replacements of the same or better calibre. This has seen a marked increase in counter offer activity, leading to increased initial offers from prospective employers to mitigate against these.

There is strong resilience in the Midlands market amidst wider macro uncertainty and real competition for the best talent. This is plainly evident in the qualified finance recruitment market. At times, candidates are getting 2 or 3 offers to choose from and this is further fuelling the growth of starting salaries offered.

However, there are other factors which need to be considered beyond starting salaries to secure talent – factors such as how well the candidate has bought into the vision and culture of the business and whether they have been made to feel wanted. Employers need to do all they can to sell their businesses to prospective employees and streamline their recruitment processes if they want to succeed in a highly competitive recruitment market.

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