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Hiring is continuing to increase but at a slower rate


The growth of staff appointments is weakening following a peak in March, according to the Recruitment and Employment Confederation (REC) and KPMG Report on Jobs, published today.

The findings show the number of people placed in new jobs by recruitment consultancies continued to increase in August, but growth slowed further from March's peak. The latest rises in both permanent and temporary staff appointments were the least marked for 10 months.

Latest data signalled a further moderation in growth of demand for staff during August. Weaker increases in demand were recorded for both permanent and temporary workers.

It also found evidence of weakening pay pressures in August. Permanent staff salaries rose at the slowest rate for seven months, while temporary staff pay growth was at a five-month low.

But although staff appointments rose at a slower pace in August, there continues to be evidence of growing skill shortages. The availability of permanent staff declined at the sharpest rate since November 2007. Temporary staff availability rose, but only marginally.

Kevin Green, chief executive of the Recruitment & Employment Confederation, says: "We are concerned about the UK jobs market. Growth is rapidly slowing as public sector job freezes start to bite and private-sector employers' confidence remains fragile.

"The young are being disproportionately affected by the worst labour market in more than two decades. The report does, however, highlight the emergence of specific shortage areas, such as chefs, nurses, engineers and internet developers, which will provide opportunities for those with the right skills. A priority for Government is to ramp up the support and guidance for jobseekers and to raise awareness of these growth areas within our labour market."

Bernard Brown, partner and head of business services at KPMG, added: "The UK job market slowdown continued in August with permanent job appointments rising at the weakest rate for 10 months. A look at the sectors also reveals the growing disparity between the public and private sector. Whereas demand for staff is growing in the private sector, many public-sector organisations have started redundancy programmes. If they are still recruiting they are doing so at a reduced pace. In the months ahead we will see a substantial reduction in public-sector headcount as the cuts begin to bite. That is the painful but inevitable consequence of the coalition Government's determination to tackle the UK's massive structural deficit. The big question is whether the private sector can create new jobs in sufficient numbers and quickly enough to offset the downturn in the public sector."