Vacancies down, salaries up?🤷🏻♂️
Smaller number of specific hires causing salary inflation among a narrow section of the workforce
The headline observation from this months (July 24) KPMG and REC UK report on jobs showed that in the preceding month permanent salaries were growing while overall permanent placements continued to fall. How could this be? Jon Holt, Chief Executive and Senior Partner of KPMG in the UK explains;
“Despite robust national employment data, the latest survey results indicate that employers are still hitting the brakes on recruitment with the general election period causing some uncertainty. Permanent hiring has taken a particular hit, as companies either delay or focus on temporary appointments. This lack of demand means competition for the few roles available continues to drive pay growth.”
This makes sense, we’ve noticed a concentration of new requirements in the business change and transformation sector with particular demand for Business Analysis type skill sets growing strongly while other areas such as infrastructure support and software engineering continue to experience lower demand than in the recent past.
There was slight rise in temporary / contract recruitment which is typical in an uncertain economy as firms are keener to offer temporary or fixed term contract roles at such times, but overall and across all sectors the demand for staff showed a slight decline extending the current downturn to 8 months. Candidate availability also grew in June suggesting that firms continued to downsize in certain areas while new roles were slow to appear.
By sector, IT and Computing and Executive/Professional were among the sectors experiencing the steepest drop in demand after Secretarial/clerical although Executive/Professional did see a slight increase in interim vacancies. In these sectors, managerial skills were deemed to be in excess supply in both the temporary and permanent markets.
Source: KPMG / REC UK Report on Jobs July 2024
Bristow Holland view
We broadly agree with the reports conclusions and have seen much the same among our client base with a few notable exceptions who are hiring strongly. The demand for analysts suggests that businesses are at the early stages of gathering requirements ahead of future projects which would indicate positive future prospects for data, development and project management professionals.
You can access read a deeper dive into the report by KPMG here
