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Permanent placements rose at faster pace in April, but growth of temp billings eased

Report on Jobs
Permanent placements rose at faster pace in April, but growth of temp billings eased

Key points:
Strong and accelerated rise in permanent staff placements. 
Temp billings increased at the slowest rate in four months. 
Permanent salary inflation edged up to nine-month high.
The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs published today provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies. 
Permanent placements increased at faster pace...
Permanent staff appointments rose at a strong and accelerated rate in April, although growth remained below Februarys ten-month high. The increase was attributed by panellists to a further marked rise in demand for permanent staff. 
...but growth of temp billings eased
The pace of expansion of temporary/contract staff billings eased to the lowest of 2011 so far. There were reports from survey respondents linking the weaker rise in short-term appointments to softer demand from public sector clients. 
Pay inflation edged higher
The rate of inflation of permanent staff salaries quickened to the highest for nine months during April, and was slightly above the surveys long-run average. Temp pay rose at the fastest pace in a year. 
Staff availability continued to rise
Recruitment consultants reported a further improvement in the availability of candidates during April. Permanent staff availability increased marginally, while temporary/contract staff availability rose at a solid pace.  
Kevin Green, Chief Executive of the Recruitment & Employment Confederation, says: This months Report on Jobs shows a clear split developing in the UK labour market. Public sector employment is radically slowing while there is growth in the private sector, confirming that we are now in a two-speed jobs market.
A number of permanent hires made in IT, construction and engineering suggest that employer confidence on the whole is improving but temporary employment is slowing. This months figures for temporary jobs are the worst weve seen for four months and is likely to have been caused by employer caution over the impending Agency Workers Regulations. The Government guidance, published last Friday, should act to reassure employers of the ongoing effectiveness of temporary labour and the value of being able to flex their workforces to meet demand.
Bernard Brown, Partner and Head of Business Services at KPMG comments:
The latest figures reveal a very mixed picture of the UK job market.  In many areas of the private sector employers feel confident to hire again on a full time basis, though the picture is very different in the public sector where hiring freezes and cost cutting seems to be the order of the day.  Indeed, private sector businesses with a dependency on the public sector are clearly on a knife edge, as they wait to understand how the unfolding government policy will impact them. The fundamental issue facing the UKs twin track job market is whether the private sector can create enough jobs to offset the expected job losses in the public sector.
If the government encourages greater private sector engagement in the provision of public services, this would not only support creation of private sector jobs in the UK, but provide a platform for those business services providers to export their skills, as governments around the world grapple with how to reduce their deficits and transform public services.


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