Ongoing uncertainty about the economic outlook and more cautious hiring policies continued to drive divergent recruitment trends in April, the latest REC/KPMG Jobs Report showed.
While temp billings pushed to a seven-month high, demand for permanent staff contracted at its fastest pace in over two years.
Permanent recruitment activity fell at the fastest pace since January 2021, when the UK was in a Covid lockdown, and for a third consecutive month it was weaker in London than in any other region.
Claire Warnes, partner at KPMG UK, said economic uncertainty had made businesses “cautious about committing to permanent hires”, with many announcing recruitment freezes or delaying decisions, while others still struggled to find candidates with the right skills.
The survey showed demand for permanent staff had weakened across all areas of the economy. However, the public sector was more resilient than the private sector, where recruiters registered the sharpest slowdown in the IT and retail industries, and in hotels and catering.
Vacancy growth fell to a three-month low while the survey showed there was a sustained improvement in the availability of candidates.
Starting salaries for permanent workers continued to rise at a historically sharp pace with the rate of inflation hitting a four-month high.
At the same time, temp wage growth improved to the highest since January.