By David Milliken
LONDON (Reuters) – Pay rates for temporary staff in Britain rose last month at the fastest pace in nearly a year and employers scaled back hiring by less than in recent months, a survey of recruiters showed on Thursday.
The Recruitment and Employment Confederation said permanent hiring fell by the smallest amount in 10 months, while billings for temporary staff dropped by the least since January.
Britain’s job market is under the spotlight as the Bank of England considers how soon to cut interest rates from their current 16-year high – a task complicated by low response rates to the main official measure of employment.
For months the REC survey has painted a weak picture on hiring and pay for newly employed workers that has mostly not carried over to official measures of the broader labour market.
Now there are signs that the downturn in the REC data is bottoming out.
“The critical moment in any labour market slowdown is the point at which demand starts to turn around. Today’s hiring data suggests that point is close, with fewer recruitment firms reporting a drop in demand,” REC Chief Executive Neil Carberry said.
Part of the growth in temporary pay – the fastest since June 2023 – reflected April’s 9.8% rise in the minimum wage, he said.
The most recent official data, for the three months to the end of February, showed annual wage growth of around 6%, while the unemployment rate increased to a six-month high of 4.2%.
REC said the availability of candidates rose at the fastest rate in five months, partly due to increased redundancies but also due to a general increase in people looking for work.
More people entering the labour market would be welcome news from the BoE and Britain’s government, which are both concerned about the inflationary and fiscal impact of a persistent fall in labour force participation since the COVID-19 pandemic.
(Reporting by David Milliken, editing by andy Bruce)
