Hiring activity across the UK remained subdued in May amid lingering economic and political uncertainty, according to the latest KPMG and REC Report on Jobs data, compiled by IHS Markit. The latest recruitment industry survey showed that the number of people placed into permanent jobs fell further, while temporary staff billings rose at the weakest rate for just over six years. Recruiters report that uncertainty regarding the outlook has dampened demand for staff in recent months, while greater risk-aversion among workers is exacerbating an already low supply of candidates.
The lacklustre labour market trends seen in the Jobs report chime with the latest UK PMI survey releases, which showed the economy was broadly stagnant during May, a trend that is likely to persist as a Conservative party leadership contest gets underway and the path to Brexit remains as uncertain as ever.
Hiring activity falters as uncertainty intensifies
The Report on Jobs survey, which monitors over 400 recruitment consultancies across the UK, provides advance signals of labour market trends. However, having signalled the current tight labour market conditions and rising pay well in advance of official ONS data, the recent survey data are now showing a notable slowdown in hiring activity compared to that seen over the past two years.
Permanent staff appointments fell modestly in May, with recruiters commonly attributing this to fewer vacancies at employers, reduced activity at clients and widespread skill shortages. Permanent placements have in fact now fallen in four of the past five months.
There had been signs of employers plugging gaps with temp workers back in April's survey, reflected in a strong rise in temp billings, but this effect appears to have faded in May, which saw only a marginal increase in temp billings that was the weakest for six years.
Digging into the latest
