Vacancy growth eases to 28-month low as hiring under pressure

Data also showed a solid fall in the permanent staff appointments, according to the latest KPMG and REC jobs report.

The survey reported that ‘companies continued to hesitate to take on additional staff in June’ (PA) (PA Archive)

Vacancy numbers grew at the slowest rate for 28 months as economic uncertainty continues to weigh on hiring, according to new figures.

The latest KPMG and REC (Recruitment and Employment Confederation) UK report on jobs showed that recruitment by firms came under pressure but the availability of candidates improved sharply as Britons came back into the jobs market.

The survey, which uses data from around 400 recruitment and employment consultancies, reported that “companies continued to hesitate to take on additional staff in June”.

Data showed a solid fall in the permanent staff appointments, although the pace of contraction eased slightly from May’s two-and-a-half-year record.

Meanwhile, temporary appointments saw a slight improvement from the previous month.

Employers are also tending towards temporary hires, given lingering economic uncertainty

Claire Warnes, KPMG UK

The figures also showed that overall vacancies continued to grow but this rate eased to the softest rise since March 2021, while growth on starting pay also eased back to its weakest since April that year.

Claire Warnes, partner for skills and productivity at KPMG UK, said: “The sharp upturn in candidate availability this month – the highest for two-and-a-half years – is a big concern for the economy, reflecting the effects of a sustained slowdown in recruitment along with increasing redundancies across many sectors.

“Employers are also tending towards temporary hires, given lingering economic uncertainty.

“And yet, the labour market remains reasonably resilient, with notable demand for skilled workers, both permanent and temporary, across a multitude of sectors this month.”

Neil Carberry, REC chief executive, said: “There is a risk of seeing an element of groundhog day in June hiring, with permanent billing easing again and firms still turning to temporary staff in the face of uncertainty.

“The growth in vacancies for temps and permanent staff in hotel and catering and blue-collar jobs, and for temp positions in retail, suggests businesses anticipate that people are still prepared to spend their wages on goods and services despite the fall in their purchasing power and the wider cost-of-living crisis.”