Fewer temp jobs as market feels effect of euro crisis

The number of temporary job placements fell in December for the first time since the recession, according to a survey of recruitment consultants.

The monthly jobs report for the accountancy firm KPMG and the Recruitment and Employment Confederation shows that agencies' billings from the employment of short-term staff declined last month for the first time since July 2009. The recruitment industry also signalled a fall in the numbers placed in permanent jobs for the third successive month in December.

The compilers of the report called the news a "worrying double whammy" for the job market, and said that the deteriorating labour market was a consequence of the eurozone crisis.

"It is a huge concern to see temporary placements falling in tandem with permanent employment opportunities, making it difficult to be optimistic about the employment market in 2012," said Bernard Brown, head of business services at KPMG.

"The decline in temporary roles ... is a clear indication that businesses are too nervous to even make short-term commitments, given the continued uncertainty across the eurozone and so much talk of a tough year ahead."

The report said the decline in temporary jobs was being driven by firms cutting costs. It also found the average hourly pay rates of staff fell, albeit modestly, in December. Permanent staff salaries remained flat.