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Recruitment downturn slowing, says KPMG and REC

While the downturn in recruitment continues, permanent placements and temp billings fell at notably softer rates than in April and May according to the latest Jobs survey from KPMG and REC.



However, redundancies and furloughed workers led to the steepest increase in labour supply since January 2009, with temp candidate numbers rising at a record pace. This, combined with subdued demand for staff, added further downward pressure on pay.



The report, compiled by IHS Markit from responses to questionnaires sent to a panel of around 400 UK recruitment and employment consultancies, found that the availability of workers rose at the quickest rate since January 2009 in June. There were widespread reports of staff supply increasing due to redundancies and workers who were on furlough and seeking new roles. Substantial increases were signalled for both permanent and temporary staff numbers, with the latter rising at the quickest rate in the survey's 23-year history.



On a regional basis, permanent staff appointments fell markedly across each of the four monitored English regions. The steepest reduction was seen in London, while the softest was in the Midlands. The steepest decline in temp billings was seen in London, while the Midlands saw the slowest reduction. Nonetheless, rates of decrease remained sharp across all four monitored English regions.



June data showed softer, but still sharp, decreases in demand for staff in both the private and public sectors. Permanent vacancies continued to decline at a steeper rate in the private sector compared to the public sector. In contrast, demand for short-term workers deteriorated at a quicker pace in the public sector.



Demand for permanent staff fell across each of the ten monitored job categories during June. Nursing/Medical/Care noted the softest rate of decline. Meanwhile, the steepest drops in vacancies were seen in Hotel & Catering and Retail.



Blue Collar was the only monitored category to register higher demand for temporary staff in June, though the rate of vacancy growth was only modest. The steepest reduction in demand for short-term workers was meanwhile seen in Hotel & Catering.



“Despite an inevitable further drop in hiring activity for permanent and temporary staff, it is encouraging to see they both fell at softer rates than seen in April and May,” said James Stewart, Vice Chair at KPMG. “However, the air of uncertainty around the COVID-19 pandemic will linger – and rebuilding confidence in the UK jobs market will take time.”



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