Hiring Activity Remains Weak as Uncertainty over the Outlook Intensifies in October

Key Findings:

– Solid drop in permanent staff appointments, temp billings rise only slightly
– Vacancy growth eases to 93-month low
– Pay continues to rise as candidate availability falls again


Commenting on the latest survey results, James Stewart, Vice Chair at KPMG, said:

“Businesses are still waiting to hear that starting gun, and until there is some certainty
around Brexit and now the election, employers continue to stall on creating vacancies and
making permanent hires.
“It’s not just businesses that are being cautious, however, and over October we’ve seen jobseekers
become increasingly nervous about making a career change. The lucky few that do
find jobs are continuing to demand higher pay as reflected in the rise in starting salaries and
temp pay.
“The IT and computing sector threw caution to the wind last month as the best performer in
vacancy growth. Meanwhile, the medical sector is not far behind, and we also saw a sharp
increase in the demand for temp staff in this sector.”

Neil Carberry, Chief Executive of the Recruitment & Employment Confederation, said:

“These figures underline why this needs to be a jobs election. The labour market is strong,
but permanent placements have now dropped for eight months in a row, and vacancies
growth has fallen to its lowest level since January 2012. One bright spark is the temporary
labour market, which continues to provide flexible work to people and businesses that need
it during troubled times.
“Ending political uncertainty and getting companies hiring again is vital – but we must
also look to the long term future of work. Jobs must be front and centre during this election
campaign, and we will be launching our REC manifesto for work next week. We will be urging
all political parties to run on policies which support and enhance the UK’s flexible labour
market – allowing businesses to create jobs, employees to build careers and the economy to


The main findings for October are:

Quicker fall in permanent staff appointments.

As has been the case throughout the majority of 2019, the number of people placed into permanent job roles fell during  October, and at a solid rate. At the same time, temp billings growth weakened to only a marginal pace. According to panel members, political and economic uncertainty continued to dampen hiring activity.

Vacancy growth weakest since start of 2012

October data signalled only a modest upturn in overall demand for staff across the UK. Notably, the rate of vacancy growth was the slowest seen since January 2012, with both permanent and short-term worker demand increasing at historically weak rates.

Candidate supply deteriorates at a steeper pace

An uncertain outlook also weighed on candidate availability during October, as people were reluctant to seek out new roles. Total candidate numbers fell at the sharpest pace for four months. This was largely driven by a steep fall in permanent labour supply, as the availability of temporary staff declined at a softer pace.

Starting salaries and temp wages both rise further
Salaries awarded to newly-placed permanent staff continued to rise sharply in October, despite the rate of inflation easing from the previous month. The average pay for short-term staff also rose markedly. Increased pay offers were widely linked to a shortage of suitably skilled candidates.

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