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SCOTTISH LABOUR MARKET CONDITIONS CONTINUED TO IMPROVE IN MAY

SCOTTISH LABOUR MARKET CONDITIONS CONTINUED TO IMPROVE IN MAY
Further rises in permanent and temporary appointments...
...driven by broad-based improvement in demand for staff
Pay increases subdued by solid candidate growth
The Bank of Scotland Report on Jobs highlighted ongoing recovery in the Scottish labour market in May. Appointments in both the permanent and temporary sectors increased, while the number of vacancies available to job seekers also rose markedly.
There was nevertheless evidence that the labour market recovery lost some momentum in May, with employment and pay rising at weaker rates, while candidate availability growth accelerated.
The moderation in the pace of jobs market improvement was signposted by the Bank of Scotland Labour Market Barometer a composite indicator designed to provide a single figure snapshot of labour market conditions falling from 54.3, to 52.3. Although the index remained solidly above the 50.0 no-change threshold, it was well below the equivalent indicator for the UK as a whole (56.4).
Donald MacRae, Chief Economist at Bank of Scotland, commented:
This months increase in appointments in both permanent and temporary jobs, as well as the rise in the number of vacancies available, is a sign that the Scottish labour market is in recovery. This recovery did lose momentum in May however, with employment and pay rising at weaker rates. While the headline index reading remains solid, it is well below the figure recorded for the UK as a whole. We can expect a continuing but muted recovery from recession, with some time before unemployment starts to fall.
Regional analysis
Edinburgh-based recruitment consultants posted the strongest rises in both permanent and temporary appointments in May, as they have done in each of the past eight months.
Agencies operating in Edinburgh subsequently recorded the fastest monthly increase in hourly temp pay rates. Permanent salaries rose at the strongest pace in Glasgow.
Glasgow-based agencies registered the strongest monthly increase in candidate availability during May.
Wages and salaries
Average salaries awarded to permanent staff rose for the fourth successive survey period during May. Nevertheless, the monthly increase was only fractional.
Latest data also highlighted a modest rise in temp staff hourly pay rates. Although the latest rise extended the current sequence of growth to five months, the pace of increase was the weakest since January.
Employment
Scottish recruitment consultants reported another rise in the number of candidates placed in permanent job roles during May. This extended the current period of expansion to eight months. However, the pace of employment growth slowed to the weakest since October 2009.
May data highlighted a strong monthly rise in temporary appointments across the Scottish labour market. The increase was again stronger than seen in the permanent sector, and extended the current period of expansion to nine months.
Vacancies
The number of vacancies available to candidates seeking long-term job roles in the Scottish labour market increased for the sixth month in a row during May. Furthermore, the pace of increase accelerated to the sharpest since September 2007.
In the temporary sector, latest data highlighted the strongest improvement in demand for staff since May 2008.
Availability
The number of candidates seeking permanent employment in the Scottish labour market rose for the twenty-sixth month in succession during May. Moreover, the pace of increase accelerated since April to the strongest in five months.
May data signalled a marked rise in the number of candidates seeking temporary job roles. Furthermore, the pace of candidate growth accelerated markedly since April to the sharpest since October 2009.
Sectors
By sector, Scottish employment agencies recorded higher demand for permanent workers in all eight monitored employment categories. The steepest increase was seen in the Executive & Professional sector.
As in the permanent sector, all eight categories of temporary employment saw rises in vacancy numbers in May. The strongest was recorded in the IT & Computing sector, the weakest in Secretarial & Clerical.
Permanent Staff Temporary/Contract Staff
1 Executive & Professional 1 IT & Computing
2 IT & Computing 2 Engineering & Construction
3 Accounts & Financial 3 Executive & Professional
4 Nursing/Medical/Care 4 Blue Collar
5 Engineering & Construction 5 Nursing/Medical/Care
6 Hotel & Catering 6 Accounts & Financial
7 Blue Collar 7 Hotel & Catering
8 Secretarial & Clerical 8 Secretarial & Clerical

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