Salaries in South are growing at fastest rate in England

The Report on Jobs: South contains original data from the survey of recruitment and employment consultants in the South of England (excluding London). The report is designed to provide a comprehensive and up-to-date guide to labour market trends and the data are directly comparable with the UK Report on Jobs.

South records strongest growth in permanent salaries of all English regions
The salaries of new starters in permanent jobs in the South of England increased for the fifth successive month in May. The rate of growth was the strongest for a year, but nevertheless weaker than the long-run survey average. Hourly rates of pay for staff in temporary/contract employment increased in May compared with one month previously, but at only a marginal rate. Pay rates have increased 15 times in the past 16 months.

The South recorded the strongest permanent salary growth of all English regions in May. Temp pay rates rose at a weak rate that was broadly in line with the UK average. Permanent salaries increased across all monitored regions except the Midlands, with the South seeing the strongest growth. Temp pay rates meanwhile fell slightly across London and the North, with the Midlands and the South recording marginal inflation.

Permanent placements growth picks up slightly in May
Recruitment consultancies in the South of England reported that permanent placements increased for the sixth month running in May. The pace of growth improved from April to a solid rate, although it was still weaker than those registered in February and March. Agencies’ billings from the employment of temporary/contract staff fell for the fourth month running. The pace of decline eased since April, but was sharper than those shown in February and March.

The South of England was the second-fastest growing English region in terms of permanent appointment growth in May, but posted the second-steepest drop in temp billings. Growth of permanent placements in England was primarily concentrated in the Midlands and the South during May, with the North seeing only a marginal increase. Meanwhile, three out of the four monitored regions recorded lower temp billings, with the Midlands the only exception.

Phil Cotton, regional chairman for KPMG in the South said: “Despite the dark shadow cast by the Eurozone crisis, the job market in the South of England rallied to put in a solid performance in May, with the number of people securing permanent jobs increasing for a sixth consecutive month.  Salaries also increased, growing at the fastest rate in England.

“Looking at these figures it would be easy to view them as a ray of hope against the wider economic gloom.  The reality remains very different.  Whilst the number of permanent staff taken on by businesses did indeed rise, the increase was weaker than the long-run series average.  The temporary jobs market also stuttered and the number of people securing a temporary job in the South fell for a fourth successive month.  Sadly this may indicate the beginning of a return to uncertainty and cautiousness when it comes to recruiting staff on the part of many employers.”

Permanent staff availability falls sharply in May
The number of candidates available to fill permanent job vacancies in the South of England fell for the second month running in May. It was the first back-to-back decline since January 2011, and the rate was the strongest for over four years. Growth of temp availability in the South of England was registered for the fiftieth month in succession in May. The rate of expansion remained modest, however, and was the slowest in 2012 to date. This contrasted with strong growth in temp candidates across the UK as a whole.

The South of England registered a sharp fall in permanent staff availability in May, contrasting with a rise across the UK as a whole. Only a modest increase in temp candidates was signalled. Permanent staff availability increased across both the North of England and London during the latest survey period, while falling in the Midlands and the South. All monitored regions bar the Midlands recorded higher temp availability over the month, with sharp improvements seen in both the North and London.

Kevin Green, Chief Executive of the Recruitment and Employment Confederation says: “This month’s data shows there is still growth in permanent placements in the South.

“What’s interesting are the niche areas that are seeing much stronger growth than the national average. In every month this year across the UK the engineering and IT and computing sectors have seen solid increases in the number of workers recruited for permanent roles.

“The UK temporary staff market has been contracting for the last six months, however, it’s important to note that there are still over a million people per week working flexibly. Employers value the ability to flex their staffing costs based on current and future demand. In temp work too there are certain skills that are still in high demand across the South of England – such as HGV drivers and core office staff.

“Looking ahead, it’s likely that unemployment figures will rise over the next few months as another wave of young people leave education. We have a weakening jobs market which will only improve once demand returns to the economy. More jobs being created in the private sector in 2012 is vital for our overall economic recovery so anything which boosts confidence is good news – the jubilee and the Olympics may yet help us turn the corner.”