Stronger rise in temp billings

While permanent placements have fallen again in May, a new report shows that temp billings have increased at the fastest rate in over three years.

This has been driven by heightened uncertainty around the business outlook, caused by the war in Iran and UK political turbulence.

Permanent Placements Declining

The latest KPMG and REC’s UK Report on Jobs shows that in May, permanent placements declined at the fastest pace since last July.

This is thought to be caused by companies pulling back on permanent hiring due to low confidence around the outlook and greater cost pressures.

At the same time, there has been a sharp increase in the availability of candidates with things like redundancies, fewer job opportunities and concerns over current job security pushing these numbers.

Momentum Being Held Up by Uncertainty

Commenting on the latest findings, Jon Holt, Group Chief Executive and UK Senior Partner at KPMG, said, “Ongoing global and domestic uncertainty is making businesses more cautious, and that is increasingly reflected in hiring decisions.

“While some employers are turning to temporary contracts to retain flexibility, many permanent hiring plans are being delayed or put on hold.

“Businesses need stability to plan and confidence to invest. With both still under pressure, the medium-term outlook for jobs remains subdued.”

Neil Carberry, REC Chief Executive, added, “The clearest story in the economy right now is momentum being held up by uncertainty. In the jobs market, that is where temporary work comes into its own.

“With businesses tapping the brakes on permanent hiring in the face of higher costs, the Gulf crisis and new employment red tape, temporary work is making up the gap. May saw its fastest rate of growth in years.

“This is a huge strength for workers and employers across the country, as it keeps the wheels turning in challenging times. Recognising this and backing our well-regulated temporary and contract workforce should be a priority for Government, starting with big changes to the approach to zero hours rules.”

To find out more about contracting, please contact Jaime on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.