Contractor billings slow as job market grinds to a halt

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    working as a contractor job market dipping

    Brexit-related uncertainty continues to affect the UK job market, according to the latest Report On Jobs, published jointly by KPMG and the Recruitment and Employment Confederation (REC).

    Permanent staff placements fell solidly at the beginning of the final quarter of 2019, as businesses chose to cancel or postpone hiring until the outcome of the general election provides more clarity over the economic outlook.

    At the same time, growth in temporary and contract billings, which have benefited from the halt on permanent hiring in recent months, slowed to a marginal pace.

    The report, compiled by IHS Markit from responses to questionnaires sent to a panel of around 400 recruitment consultancies, also revealed that job vacancy growth has slowed to a pace last seen in January 2012, a 93-month low.

    Candidate availability also dropped, as candidates postponed decisions on changing jobs due to the ongoing uncertainty. Total candidate numbers fell at the sharpest pace for four months, although this was mainly in the permanent sector. Temporary and contract staff were also in shorter supply, but the decline in numbers for those working as a contractor was more gradual.

    Commenting on the latest survey results, Neil Carberry, Recruitment & Employment Confederation chief executive, said:

    “These figures underline why this needs to be a jobs election. The labour market is strong, but permanent placements have now dropped for eight months in a row, and vacancies growth has fallen to its lowest level since January 2012. One bright spark is the temporary labour market, which continues to provide flexible work to people and businesses that need it during troubled times.

    “Ending political uncertainty and getting companies hiring again is vital – but we must also look to the long term future of work.  Jobs must be front and centre during this election campaign, and we will be launching our REC manifesto for work next week. We will be urging all political parties to run on policies which support and enhance the UK’s flexible labour market – allowing businesses to create jobs, employees to build careers and the economy to grow.”

    James Stewart, Vice Chair at KPMG, said:

    “Businesses are still waiting to hear that starting gun, and until there is some certainty around Brexit and now the election, employers continue to stall on creating vacancies and making permanent hires.

    “It’s not just businesses that are being cautious, however, and over October we’ve seen job-seekers become increasingly nervous about making a career change.  The lucky few that do find jobs are continuing to demand higher pay as reflected in the rise in starting salaries and temp pay.

    “The IT and computing sector threw caution to the wind last month as the best performer in vacancy growth.  Meanwhile, the medical sector is not far behind, and we also saw a sharp increase in the demand for temp staff in this sector.”

    11th November 2019.