Report reveals jobs market slowdown
Published 08/06/2011 | 00:12
Demand for staff has fallen back, with permanent and temporary placements increasing at the weakest rates in seven months, according to a new report.
The Recruitment and Employment Confederation (REC) said growth of job vacancies moderated in May to a five-month low.
Recruitment consultants signalled a modest improvement in the availability of staff to fill job vacancies during May, but the rates of growth of both permanent and temporary candidate availability eased.
Kevin Green, chief executive of the REC, said: "The latest data shows a worrying deceleration in the UK jobs market. Although the number of placements has continued to increase, the rate of expansion has hit a seven-month low.
"Private sector job creation has not hit the buffers but it is clearly slowing which heightens concerns over whether public sector job losses can be absorbed.
"There have been signs of increasing employer confidence in some sectors but economic growth remains too fragile to spark the real step-change that our jobs market needs. With consumer confidence at a low ebb, many individuals who would normally be looking to change jobs are staying put."
Bernard Brown, partner and head of business services at KPMG, which helped compile the report, added: "The latest figures are worrying because they reveal a marked slowdown of the UK jobs market. We'll need to see whether this is a trend or a blip. Employers across all sectors are becoming more cautious about hiring new staff.
"With businesses and consumers now being hit by higher taxes and fuel costs, public spending cuts and a continuing squeeze on real incomes - this is perhaps no surprise."
A Department for Work and Pensions spokesman commented: "We have always acknowledged that the economic recovery could be choppy. The most recent figures show that there has been a 450,000 rise in private sector employment on the year, only partly offset by a 130,000 fall in the public sector.
"We have a long way to go before we deal with all the economic challenges ahead but the launch of the Work Programme will make a big difference in ensuring that people on out of work benefits can take advantage of the one million rise in employment that the independent Office for Budget Responsibility expects over the next few years".