UK hiring falls at fastest pace in over three years, wage growth slows

LONDON, Aug 7 (Reuters) – British employers cut the number of new permanent employees they hired through employment agencies by the most since mid-2020 last month on concerns about the economic outlook, adding to to signs that the market is getting tougher for job seekers. .

An indicator of permanent staff hiring by the Confederation of Recruitment and Employment and KPMG accountants fell to 42.4, the lowest level since 34.3 in June 2020 when the country was in lockdown due to the COVID pandemic. -19.

The survey’s measure of temporary hiring, which often rises when employers are cautious about the outlook, showed the weakest growth in nine months in July, partly because more workers sought the security of permanent jobs.

Neil Carberry, chief executive of the REC, said the job market remained “pretty strong” despite a slowdown in permanent placements.

“To some extent this is normalization as the post-pandemic boom subsides, but it is also driven by uncertainty,” he said.

While the starting salary for new permanent staff increased sharply compared to pre-pandemic standards, the rate of salary growth was the lowest since April 2021, the REC said.

Claire Warnes, a skills and productivity partner at KPMG UK, said competition for skilled workers and cost-of-living pressures were keeping starting wages high.

Monday’s survey coincided with other indicators showing the job market is easing, good news for the Bank of England, which raised interest rates for the 14th straight meeting to 5.25% last week and has been concerned about high wage growth.

The official data showed unemployment rose to 4% in the three months to May, a 16-month high, though annual wage growth held at an all-time high of 7.3% in cash terms.

Separate figures from BDO accountants showed rising interest rates, difficult business conditions and weak demand weighing on hiring intentions and business confidence in the service and manufacturing sectors.

BDO’s employment index fell for the first time in six months in July and its optimism gauge declined for the first time in four months.

REC said the availability of temporary and permanent workers to fill jobs reached the highest level since December 2020.

Reporting by Suban Abdulla; Edited by David Milliken

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