Yahoo Finance UK demand for staff slips as companies cut costs
The UK jobs market cooled at the end of last year, with growth in vacancies and wages slowing to the lowest rates in more than a year, according to a survey of recruiters.
The monthly index of vacancies, compiled by the Recruitment and Employment Confederation (REC) trade body and accountants KPMG, fell in December to 53.0 as companies paused recruiting to cut back costs.
The figure is down from 54.1 in November to the lowest since February 2021.
Pay pressure on employers continued to soften in December, with starting salaries for permanent staff and pay rates for temporary workers growing at the slowest rate since April 2021.
Read more: Over 1.4 million households facing mortgage hike
However, inflation meant wage rates remained strong in the context of historical data.
"A slowdown in permanent placements is not unusual in December, but this one comes as part of a wider softening trend in the permanent market," said REC chief executive Neil Carberry.
"Recruiters tell us that this was enhanced by firms pushing hiring activity back into January in the face of high inflation and economic uncertainty."
Permanent staff were most in demand in nursing/medical/care, followed by hotel and catering. Construction saw the quickest drop in vacancies.
Temporary staff demand rose across all sectors, according to the REC and KPMG. Retail, hotel/catering and nursing/medical/care experienced the sharpest rises in demand.
Read more: UK households to be £2,100 worse off amid cost of living crisis, think tank warns
“As we move into 2023, the need to ensure our labour market can deliver economic growth and prosperity should be a critical concern for politicians. People telling recruiters that they are increasingly anxious about moving jobs is a concern in this regard – as a move is a great way to boost pay and build up skills,” Carberry said.
“If people are less willing to move jobs, this could make shortages worse in the near term.”
