Availability of UK jobs candidates rose for the first time in more than two years last month, according to a survey of recruiters, while levels of pay increase were close to the slowest in two years.
The supply of workers in March increased for the first time since February 2021, supported by “modest” rises in both permanent and temporary staff availability, the KPMG and REC jobs report showed on Wednesday.
A number of recruiters mentioned a relative improvement in confidence among job seekers, though staff supply was also increased by recent redundancies.
While availability improved, economic uncertainty caused firms to make redundancies and often opt for temporary hires over permanent placements, making it a “curate’s egg” of a month, said KPMG UK partner Claire Warnes.
Temp billings grew at a six-month high and there were reports of clients delaying hiring decisions due to the uncertain economic climate, though a six-month decline in permanent placements reached its slowest pace. The number of permanent roles expanded “sharply”, while the growth in temp vacancies moderated to a 26-month low in March.
Levels of starting pay saw “marked” increases, amid the ongoing high cost of living and difficulty for firms to attract and secure suitable staff – though the level of growth was the second-slowest for nearly two years.
Vacancy numbers also saw a further marked increase, though the rate of growth eased slightly from February's four-month high.
“Over the past few weeks, we have seen a bit more confidence among employers, and this is reflected in this latest data,” said Neil Carberry, chief executive of REC, highlighting the “significant” easing of the contraction in the permanent jobs market in March.
“After six months of slowing activity from last summer’s peak, the market is now better described as flat than declining. This is the mark of an economy performing better than was expected at the end of last year," Carberry added.
He said the rise in candidate availability is “big news”, which suggested that, “while the market is still tight, it should be getting gradually easier for firms to hire over the next few months”.
Continuing fast rates of pay growth are “likely to persist, despite more people beginning to look for work”, Carberry added, as overall inflation remains high and labour supply low.