London Labour Market 8th August 2012 | 08/08/2012
Report on Jobs: London
Permanent placements across the capital down markedly in July
The Report on Jobs: London is a monthly publication produced by Markit and sponsored by the Recruitment and Employment Confederation and KPMG LLP.
The report features original survey data which provide the most up-to-date monthly picture of recruitment, employment, staff availability and employee earnings trends in London.
1 Staff appointments / Vacancies
2 Staff availability
3 Pay pressures
4 Regional comparisons
Key points from July survey:
• Permanent appointments and temp billings both decrease
• Job vacancies drop at accelerated rate
• Strong rises in candidates available for permanent and temp work
Staff appointments / Vacancies
Recruitment consultancies report on the number of people placed in permanent jobs each month, and their revenues (billings) received from placing people in temporary or contract positions at employers.
Appointments of permanent staff fall sharply
July saw a further sharp reduction in the number of permanent appointments across London, with the rate of decline easing only moderately from June’s 39-month record fall. The decrease was the sixth in successive months, and steeper than the drop at the UK level.
Moderate drop in temp billings
Temporary billings in London decreased for the ninth consecutive month during July. The rate of decline was faster than in June, though still only moderate overall. The UK as whole meanwhile saw an eighth straight monthly decrease in billings from the employment of temp staff.
The demand for both permanent and temporary staff in London decreased markedly during July, extending the respective sequences of contraction to three months. In both cases, rates of decline were the fastest for almost three years. In contrast with the trends in the capital, the UK as a whole saw further increases in vacancies for both permanent and temporary jobs.
Recruitment consultants are asked to report whether availability of permanent and temporary staff has changed on the previous month.
Steep and accelerated improvements in the availability of candidates for both permanent and temporary vacancies were registered in July.
Permanent staff availability improves markedly
The number of candidates looking for permanent work in London increased at an accelerated rate in July, and one that was the sharpest since October 2009. Increasing availability has been recorded throughout the past three months in the region. The rate of improvement at the UK level also quickened, though was still down on that recorded in the capital.
Steep rise in candidates seeking temp work
London-based recruitment consultants recorded a sharp rise in the availability of candidates for temporary vacancies. Moreover, the rate of improvement was the steepest for 34 months. Data also showed a robust increase in candidate availability for short-term work across the UK economy as a whole, with the rate of improvement unchanged since the previous survey period.
The recruitment industry survey tracks both the average salaries awarded to people placed in permanent jobs each month, as well as average hourly rates of pay for temp/contract staff.
After falling slightly in the previous survey period, permanent starting salaries in London increased solidly on average during July. The rate of inflation was the fastest since last August, and above that registered UK-wide.
Temp/contract pay rates
In stark contrast to the trend in permanent salaries, temp pay in the capital fell at a faster rate – the steepest in 2012 so far. That extended the ongoing period of decline to four months. Meanwhile, hourly pay rates for temp staff across the UK as whole fell marginally.
UK average weekly earnings
Data from the Office for National Statistics signalled that average weekly earnings across the UK rose 0.3% year-on-year to £543 in the first quarter of 2012.
The West Midlands recorded by far the strongest growth, with earnings rising 9.7% to £517. In contrast, the East Midlands registered the sharpest fall, with earnings dropping -4.6% on the year to £492.
The Report on Jobs: London is one of four regional reports tracking labour market trends across England. Data are also available for the South of England, the Midlands and the North of England.
July saw a much sharper decrease in permanent placements within London than across the UK as whole. In terms of temp billings, a moderate fall in the capital was slightly faster than the rate of decline at the UK level.
Permanent appointments decreased in all regions bar the Midlands, where no change was registered. Reductions in temp billings across London and the North meanwhile contrasted with marginal and moderate growth in the South and Midlands respectively.
Recruitment consultants in London recorded sharp increases in the availability of candidates for both short- and long-term work in July, with rates of improvement faster than those recorded for the UK as a whole.
The South of England was the only region where the number of permanent candidates decreased in July, with the strongest rise seen in the capital. This trend was repeated with regards to temporary candidate numbers.
Starting salaries for permanent workers in London rose at a faster rate than across the UK on average, while temp pay rates in the capital fell more quickly than at the UK level.
Permanent salaries increased across all four monitored regions, with the fastest rise seen in the Midlands. Meanwhile, only the South posted inflation of temporary pay rates. Both London and the North saw falls in temp wages, with the sharper decline registered in the capital.
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