· News

KPMG and REC survey reveals three months uninterrupted growth in permanent recruitment

Permanent recruitment in the UK grew continuously for the three consecutive months from October to December 2012, according to the KPMG and Recruitment and Employment Confederation (REC) Report on Jobs.

The report showed the recruitment market for temproary positions has also grown for five months continuously, from August to December 2012 and labelled the news as 'another milestone for the UK labour market', which has not experienced a full quarter of simultaneous increases in both temporary and permanent jobs since mid-2011.

The report showed that although there were increases in permanent and temporary staff appointments during December, in both cases the rates of growth eased since November.

It also showed a 'moderate' increase in wages and salaries. Rates of inflation of permanent salaries and temporary wages quickened to 15 and nine-month highs respectively in December.

REC chief executive Kevin Green said: "The picture for 2013 is likely to be similar to 2012, and we expect the labour market to yet again outperform the sluggish economic growth in the UK. Employers are confident in their own businesses if not the economy as a whole and know they have to retain or recruit talent in order to have a competitive advantage.

"In fact, the developing story this year is likely to be one of skills shortages as people with expertise in key areas become harder and harder to source. We are already seeing this in areas like IT and engineering and recruiters are telling us that candidates are in short supply to fill jobs for drivers, chefs and carers."

Bernard Brown, partner and head of business services at KPMG, said: "It's concerning to see the pace of recruitment slowing. Job placements may still be moving in the right direction but questions must now be asked about whether the declining rate of growth is indicative of a longer-term problem.

"It seems that the time lag many economists spoke about towards the end of last year is shrinking, as employers delay decisions until they have more certainty about the economy. Individuals are also showing signs that they'd rather stick with what they know, as the numbers making themselves available for permanent roles has dropped for the first time since April 2012.

"However, with some areas of the country outperforming others and the private sector seeing more job placements in December, the hope must be that employers will handle this latest setback."

Brown added: "They certainly reacted positively to news that a fiscal cliff was avoided in the US and, if this is anything to go by, we should see the trend for rising employment continue. It may be slower than in the last few months of 2012, but growth should still be welcomed."