The latest KPMG and REC UK Report on Jobs survey, compiled by S&P Global, pointed to a sixth decrease in permanent placements in the Midlands in as many months midway through the final quarter of 2024. The rate of decrease was marked overall, albeit slightly softer than that seen in October. This was in stark contrast to temp billings, which rose at a solid rate during November.
Sustained falls in permanent staff appointments contributed to a further steep rise in candidate availability in November, notably with permanent candidate numbers increasing to the greatest extent since June. There was a softer increase in the rate of permanent salary inflation, meanwhile, which was at the lowest in the current sequence which began in March 2021.
Steep decrease in permanent placements
Permanent placements fell in the Midlands for the sixth successive month in November. The rate of decrease eased only slightly from October and remained robust overall. That said, the reduction in the Midlands was the softest of the four monitored English regions.
Respondents indicated weak client confidence, lower demand for staff and uncertainty.
Recruiters in the Midlands recorded a rise in temporary billings in the penultimate month of 2024. The increase was solid and the strongest in five months. Anecdotal evidence suggested that firms opted for temporary staff to fill roles in the absence of suitable permanent candidates.
Growth in the Midlands contrasted with a fall at the UK level, with the remaining three monitored regions seeing temp billings decrease.
Demand for permanent staff in the Midlands fell for the sixth month running in November. The rate of decrease was strong, and the most pronounced since June 2020. Moreover, the Midlands saw the second-steepest fall in vacancies of the four monitored regions, ahead of the South of England.
The rate of decline in demand for temporary workers was little-changed from October and moderate overall. Moreover, the reduction in the Midlands was the softest of the monitored regions.
Quickest increase in permanent candidate numbers for five months
The number of candidates available for permanent roles increased markedly during November, with the latest rise extending the current sequence to 20 months. The improvement in the Midlands was the sharpest since June and the strongest of the four English regions.
Panelists indicated that redundancies had been one of the main factors behind the rise in candidate numbers.
Recruitment companies in the Midlands reported that a lack of available temporary jobs contributed to a further rise in temp candidate availability. The rate of increase eased slightly from October but was the second-strongest recorded in the past year.
The Midlands posted the fastest rise in temporary staff availability of the monitored regions.
Softer rise in permanent starting salaries
Salaries for new permanent joiners continued to rise during November. That said, the rate of inflation softened from the previous survey period to the weakest since the current sequence of increasing salaries began in March 2021. Recruiters often indicated that higher salaried roles were being offered to attract suitable candidates, however this was partially offset by a wider pool of candidates being available.
The rise in permanent salaries was slower than the UK average.
Recruitment companies in the Midlands signalled a renewed decrease in temporary pay rates midway through the final quarter of the year. The rate of reduction was marginal, but the most pronounced since October 2020, with the Midlands the only monitored region to see a fall.
Kate Holt, People Consulting Partner at KPMG in the Midlands, said: “While November’s drop-off in permanent placements may be less pronounced than in other parts of the country, declining levels of recruitment in the Midlands remains a long-term issue.
“Indeed, many of those that paused their plans ahead of the Budget appear not to have accelerated them again in light of the increase to National Insurance and the cost of hiring next year.
“Finding people with the right skills also remains a challenge but one that needs to be addressed if businesses are to pursue their growth plans. As businesses continue to grapple with both sets of challenges, we may well see the Midlands market continue to invest in temporary appointments to plug gaps within teams.”
Neil Carberry, REC Chief Executive, said: “No one should be surprised that firms took the time to re-assess their hiring needs in November after a tough Budget for employers. The drop in vacancies nationally was led by private sector permanent roles, and slower permanent recruitment billings across the month also reflected this trend.
“The real question now is whether businesses will return to the market as they go into next year with greater certainty about the path ahead.
“The resilience of temporary recruitment offers some hope – private sector temporary hiring activity was almost flat across the country, by comparison with the drop in permanent hiring. And in the Midlands, the increase in temporary billings was solid and the strongest in five months.
“Firms are likely to rest more on temps while they manage the current uncertainty, and that only serves to emphasise again the value of flexible forms of work to companies and people who need to find work quickly after redundancy.
“For policymakers, ensuring new regulations support rather than weaken our flexible jobs market is vital – especially after the Budget. Ensuring rules introduced by the Employment Rights Bill are tailored to protect agency and temporary work really matters for people.”
