Job hires up but outlook is less rosy

LABOUR market conditions continued to improve in May but growth in the number of permanent hires fell for the second consecutive month, the KPMG/REC?Report on Jobs will show today.

The survey said that higher staff appointments were underpinned by a further improvement in demand for staff during May. Recruitment consultancies indicated that growth of vacancies was strong, albeit marginally slower than in April. Wages and salaries also continued to increase for the seventh month running. However, growth eased from the twenty-five month high in April.

However, while the figures were generally positive, there was concern about the outlook. Kevin Green, chief executive of the Recruitment & Employment Confederation (REC), said: “We remain concerned about the overall employment outlook as public sector recruitment freezes start to bite.” He added: “With fewer opportunities in the public sector and jobs growth in the private sector improving only very slowly, predictions of a jobless recovery are looking more likely.”

Bernard Brown, partner and head of business services at KPMG, said that the figures suggest that hiring activity in the public sector has started to slow down.

The Manpower Employment Outlook for the third quarter, out yesterday, held steady with a net balance of one per cent of firms planning to hire staff between July and September. “The impact of government-imposed spending cuts on both public sector departments and private sector outsourcing is casting a shadow over the UK’s gradual recovery,” said Mark Cahill, Manpower UK’s managing director.