Professional recruitment firms reported that vacancy numbers and hiring flatlined in November, with the number of permanent vacancies rising by just 0.3% year-on-year according to new survey data from the Association of Professional Staffing Companies (APSCo).
This is in line with the latest data from the Office for National Statistics (ONS), which reported in December that employment levels across Britain dipped for the first time in a year and a half in a sign that the UK jobs market is losing steam following the EU referendum.
The ONS data shows that overall employment stood at 74.4% in the three months to October, marking the first drop since February to April 2015 triggered by a 6000 fall in the number of people in work. APSCo data, which focuses on professional recruitment, reveals notable variations between the trade association’s core sector groups in terms of hiring activity. While permanent vacancies across both financial services and marketing, for example, have increased (1% and 13% respectively), IT and engineering have both recorded dips of 5%.
Contract vacancies slide
Demand for professional contractors decreased by 5% across the board year-on-year. Engineering was the only sector that enjoyed modest growth, with vacancies increasing by 1%. Demand for IT and finance professionals recorded the sharpest drop in demand with vacancy numbers falling by 13% and 7% respectively.
The drop in vacancies for IT contractors was partially balanced by a 5% increase in permanent roles, which suggests that organisations are slowly moving away from the short-term approach to hiring that was adopted after the referendum. The Confederation of British Industry has predicted that the IT sector will enjoy some of the highest levels of job creation in 2017.
Average salaries down
APSCo’s figures also reveal that median salaries across all professional sectors dipped by 1.4% year-on-year. This figure is characterised by notable fluctuations in terms of sector, with marketing, for example, recording an uplift of 1.6% while in banking average salaries were down 7.7% year-on-year.
Ann Swain, Chief Executive of APSCo comments: “As the starting date for negotiations over leaving the EU approaches, it seems that employers are taking a slightly more cautious approach to hiring. However, while permanent vacancies remain largely resilient, demand for contractors has dipped.
“As is often the way in times of uncertainty, the run up to the referendum and immediately after, employers turned to a contingent workforce to keep the wheels in motion. Now hiring managers are re-adjusting to the new landscape and taking a breather so that they can plan workforces strategically moving forwards.
“Despite the less than rosy picture these latest figures project, the UK employment rate remains high and research from the Confederation of British Industry (CBI) suggests 41% of companies expect to grow their workforces in 2017, compared with just 13% that believe their payrolls will shrink.”