The UK job market is beginning to show signs of recovery, marked by an upturn in pay and the first increase in temporary vacancies in two years. This is according to a monthly survey from KPMG and the Recruitment and Employment Federation.
Permanent job placements stabilised in July, bringing an end to a 45-month period of decline. London and the Midlands saw renewed growth in permanent staff hiring, with the capital experiencing a near four-year high in growth. However, declines continued in the south and north of England.
Pay continued to improve in July, with starting salary inflation reaching its highest level in six months. Temporary wage growth also hit a 26-month high. Recruiters noted a lack of suitably skilled or experienced candidates for roles.
Rob Wood, chief economist at Pantheon Macroeconomics, suggested that rising employment and wage gains indicate the Bank of England's monetary policy committee needs to be cautious. Callum Licence, head of advisory at KPMG UK and Switzerland, highlighted that businesses are starting to invest, leading to data moving in a positive direction, particularly in temporary work.