The study, which surveyed more than 1,000 HR decision-makers in the UK, revealed that 59% of businesses are experiencing increased competition to find the right skills, rising to 74% of companies with over 1,000 employees.
Meanwhile, 75% of employers say that candidates have higher salary and benefit expectations.
James Cockett, labour market economist at the CIPD, told HR magazine that employers are becoming more positive about the opportunities for economic growth.
He said: “The uptick in temporary hires suggests cautious optimism from employers, who need staff but aren’t ready to commit to permanent hires.
“Economic growth data is more positive than in recent months, with the economy growing, albeit at a snail’s pace. Employers continue to fight for talent into 2024, increasing salaries to attract prospective applicants.”
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Wellbeing and benefits consultant Steve Herbert said that employers are using temporary workers to be more agile as political and economic uncertainty continues.
He told HR magazine: “While the latest economic figures from the ONS suggest that the UK may no longer be in recession, the relatively small levels of growth indicated suggest that the economy is far from robust.
“With both the domestic and global political future very uncertain, employers are unlikely to want to commit to full-time employees just yet.
“It follows that employers are looking for the ‘easy’ option of short-term labour appointments with less employment protections to be considered if a future pivot and downsize has to be considered.”
Herbert also warned that employers may face challenges when attempting to put temporary hires onto full-time contracts.
He added: “The challenge for employers will be to decide when is the right time to start offering full-time contracts again, and whether they will be able to encourage their temporary workers to take up full-time contracts at that point.
“It is worth noting that temporary workers often earn more than their full-time equivalents to offset the uncertain future of such work, so converting to full-time contracts may pose other challenges for the employer, not least whether such appointments may impact the established pay scales for existing employees.”
