The jobs survey found that July showed a record rise in starting salaries which hit 73.2 from 66 on the job survey’s index, which is the sharpest rise in nearly 24 years of data collection. The report states that this is due to a continued decline in candidate availability in July.
The decline in candidates is supposedly driven by concerns over job security due to the pandemic, a lack of European workers due to Brexit, and a low unemployment rate. Overall, candidate numbers fell at the second-sharpest rate in the survey history.
The report, which surveyed some 400 UK recruitment and employment consultancies, also found permanent and temporary staff appointments rose at near-record rates.
The growth in permanent staff hit 69.3 in July which eased slightly from June’s all-time high record of 71.2, with temporary billings rising to 64.6 from 59.6 in March 2021 which is the quickest rate since November 1997.
London saw the quickest expansion in permanent staff appointments, this expansion was led by blue collar workers followed closely by hotel and catering while the Midlands saw a stronger rise in temporary billings. The north of England saw a softer growth but remained mostly constant overall. The sector with the softest expansion was retail.
Claire Warnes, partner and head of education, skills, and productivity at KPMG UK said: ‘With salaries for new hires increasing at their quickest rate in 24 years and a sharp rise in permanent placements in July, job seekers should be taking advantage of the buoyant market to land their dream role.
‘But while companies want to invest in their business now restrictions are lifting, demand for new staff still outstrips supply due to low candidate availability. We know that reskilling and upskilling is needed to help people move between sectors, and there’s no doubt the ‘pingdemic’ has added an extra dimension to the recruitment challenge. Plus, with furlough due to end soon, there may be a downward pressure on pay to come.’
The survey found that there were stronger increases in vacancies across the private sector during July while in contrast, the public sector saw short-term vacancies rising more quickly than permanent roles.
Kate Shoesmith, deputy chief executive of the REC, said: ‘This month’s data confirms that it is a good time to be a looking for a new job. Employers are desperate to find good candidates for the many jobs on offer and this is reflected in starting salaries rising at the sharpest rate since the survey began in 1997.
‘This will likely motivate more people to be on the lookout for new opportunities. The same goes for those on temporary contracts which are also seeing increased pay. Recruiters are working hard to fill places for employers eager to build back and recover but their job is made more difficult by worker shortages across all sectors.’
The REC stated that the current pay increases will not solve the demand that has been building up over the recent months. It added that the UK needs to have an immigration system that ‘flexes to meet demand as was promised’ and that ‘business and government need a long-term plan for skilling up workers’.
