Demand for permanent staff declines as Britain’s economic outlook worsens

Tim Wallace
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EMPLOYERS are increasingly reluctant to take on permanent staff, preferring temporary contracts because they are uncertain about the strength of the economy, a report published today from KPMG reveals.

Permanent placements fell for the first time in two years in October. The survey’s index now stands at 49.7, down from 51.2 in September and 52.4 in August. Any figure over 50 indicates expansion in permanent placements.

Over the last year growth in demand for financial and accounting workers has declined, with the index falling from 55 to 51.6.

Growth in salaries has ground to a halt, according to the study. The index for permanent staff’s salaries came in at 50.1, down from 52.9 in September.

“The UK’s permanent jobs market has stalled for the first time since July 2009,” said Kevin Green, chief executive of the Recruitment and Employment Confederation.

“The government must do more to help especially in encouraging small private sector employers to take on young people – the situation is becoming critical,” he added.