According to the latest KPMG and REC UK Report on Jobs survey, greater economic uncertainty, pressure on clients’ budgets and low candidate numbers all simultaneously dampened hiring activity towards the end of 2022.
– Permanent placements fell for the third consecutive month and at the quickest rate since 2021
– Billings for temporary staff rose only modestly
– Growth of demand for workers cooled, with overall vacancies rising at the slowest rate since February 2021
– The downturn in candidate availability continued to ease
– Starting salaries and temp wages both climbed higher in response to the cost of living and low candidate supply, however, rates of pay growth were the softest seen for 20 months
Permanent staff appointments fall at a quicker pace
At the end of 2022, the number of people placed into permanent jobs fell for the third month running. This is due to economic uncertainty as well as pressure on budgets, which subsequently weighed on recruitment plans.
This rate of reduction was the quickest seen since January 2021, when the third national lockdown affected hiring.
On the other hand, temp billings expanded further in December, but the rate of growth remained modest overall.
The overall growth of vacancies slips to a 22-month low
Driven by a weaker upturn in permanent staff demand, the overall rate of vacancy growth weakened for the ninth consecutive month, and was the slowest seen since the current period of recovery commenced in February 2021. Temp vacancies expanded at a slightly quicker pace.
Candidate supply falls at softest pace since March 2021
More people became cautious about seeking new roles in the current climate, which dampened candidate availability. This, combined with an already tight labour market drove further drops in the supply of both permanent and temporary labour.
Starting pay increases at a slower, but still strong rate
Pay pressures continued to soften towards the end of 2022, but in terms of historical data, they remained strong.
Both starting salary rates and temp pay growth rates hit their lowest since April 2021.
Where higher rates of pay were reported, this was frequently linked to competition for scarce staff on top of the rising cost of living.
– The demand for staff remained stronger across the private sector than the public sector at the end of 2022
– The steepest overall increase in vacancies was seen for temporary workers in the private sector
– The slowest increase in vacancies was reported for permanent public sector staff
– Construction saw the quickest drop in vacancies
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