Kpmg Report On Jobs Dec09

UK labour market 9th December 2009

The most up-to-date source of monthly UK labour market data and analysis

Report on Jobs
Fastest rise in permanent staff placements
for twenty-eight months in November.

Index , 50.0 = no c hange
70.0
The Report on Jobs is a monthly
publication produced by Markit Economics P e rm a ne nt
65.0 P la c e m e nts
and sponsored by the Recruitment and
Employment Confederation and KPMG
60.0
LLP.
55.0
The report features original survey
data which provide the most up-to- 50.0
date monthly picture of recruitment,
employment, staff availability and 45.0 Te m p Billings
employee earnings trends available.
40.0

1 Executive summary 35.0

2 Appointments 30.0

3 Vacancies 25.0
Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09
4 Sectoral demand

5 Staff availability

6 Pay pressures Key points from November survey:

7 Special feature  Growth of permanent staff appointments strongest since July 2007.

 Temp billings rose at sharpest rate for nineteen months.

 Robust expansion of demand for staff.

 Permanent salaries increased for first time in fifteen months.
Markit Economics  Slower improvement in candidate availability.

Henley on Thames
Oxon RG9 1EL, UK

Tel: +44 1491 461000 Commenting on the latest survey results, Bernard Brown, Partner and Head of Business
Fax: +44 1491 461001 Services at KPMG said:
email: economics@markit.com
“Looking at the latest data one might get the impression that the recession is over. Confidence
has definitely returned to the private sector and the UK jobs market looks healthier today
Copies of the report are available than at any time in the last two and a half years. However, we are still to see the impact of the
on annual subscription from government’s anticipated public sector cuts on the jobs market, which will play out over the
Markit. For subscription details next 12 to 18 months.”
please contact:
economics@markit.com

Report on Jobs | Recruitment Industry Survey

1 Executive summary

The Report on Jobs is unique in providing the most
comprehensive guide to the UK labour market, Staff Appointments
drawing on original survey data provided by 50 = no change on previous month 50=no change on previous month
70 70
recruitment consultancies and employers to provide Temp/Contract Billings
the first indication each month of labour market 65 65

trends. 60 60

55 55

The main findings for November are: 50 50

45 45

Growth of staff appointments 40
Permanent Placements
40

accelerated again... 35 35
Both permanent staff placements and temporary/contract staff
30 30
billings increased at faster rates in November, with the latest
expansions the strongest for twenty-eight and nineteen months 25 25
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
respectively.

...driven by stronger rise in demand Demand for staff
for staff Increasing rate of growth 50 = no change on previous month
Higher placements and billings were underpinned by a robust
75
and accelerated rise in job vacancies during November.
Nursing/Medical/Care was the most in-demand category of Temp/Contract Vacancies
70

permanent staff, while Engineering/Construction employees 65
were the most sought-after temps. 60

55

Modest increase in permanent 50

salaries Permanent Vacancies
45

Permanent staff salaries rose for the first time in fifteen months 40

in November, albeit only modestly. Hourly rates of pay for 35
temporary/contract continued to fall, but the latest drop was the 30
weakest in the current fourteen-month period of decline. Increasing rate of decline
25
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Slower rise in candidate availability
Growth of staff availability eased further in November. The
number of permanent staff available to fill vacancies increased Staff Availability and Earnings Growth
at the weakest rate for seventeen months, while temp
50 = no change on previous month 50 = no change on previous month (inverted)
availability rose at the slowest pace since July 2008.
70 Skill shortages
(Availability of staff 30
65 inverted - RHS)

40
60

50
55

60
50

45 70

Average permanent salaries (LHS)
40 80

35 90
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

All Intellectual Property Rights owned by Markit


2 Staff appointments

Recruitment consultancies report on the number of
Staff Appointments via Recruitment Consultancies
people placed in permanent jobs each month, and
50 = no change on previous month
their revenues (billings) received from placing people 75 Increasing rate of growth
in temporary or contract positions at employers.
70 Temp/Contract Billings

65
Latest data signalled that the recent upward trends in both
permanent and temporary/contract staff appointments 60
continued during November.
55

Growth of permanent placements 50

reached twenty-eight month high... 45
Recruitment consultancies indicated an increase in the
40
number of people they placed in permanent jobs for the
fourth consecutive month in November. Moreover, the rate 35 Permanent Placements
of expansion accelerated to the strongest since July 2007.
30
Panellists commented that clients had stepped up recruitment
Increasing rate of decline
in response to increased activity levels. 25
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

...while temp billings rose at fastest
pace for nineteen months
Agencies’ billings received from the employment of
temporary/contract staff continued to rise in November, with Permanent Staff Placements
growth accelerating to the sharpest since April 2008. Survey Q. Please compare the number of staff placed in permanent
respondents attributed higher temp billings to increased positions with the number one month ago.
numbers of short-term vacancies.
Higher Same Lower Net Index S.Adj.
% % % +/- 50 = no chg Index
An index reading above 50 signals a higher number of
2009 Jun 34.6 35.3 30.1 4.5 52.2 48.6
placements/billings than the previous month. Readings below
Jul 25.6 41.3 33.0 -7.4 46.3 46.1
50 signal a decline compared with the previous month.
Aug 32.9 33.4 33.7 -0.9 49.6 50.6
Sep 39.7 36.6 23.6 16.1 58.0 52.8*
Oct 38.6 36.4 25.0 13.6 56.8 55.6*
Nov 39.5 38.7 21.8 17.6 58.8 61.7

Temporary/Contract Staff Billings
Q. Please compare your billings received from the
employment of temporary and contract staff with the
situation one month ago.
% % % +/- 50 = no chg Index
2009 Jun 30.0 39.7 30.2 -0.2 49.9 44.9
Jul 26.0 45.3 28.7 -2.6 48.7 45.1
Aug 27.6 42.6 29.8 -2.1 48.9 50.3
Sep 31.7 46.9 21.4 10.3 55.1 51.9*
Oct 33.1 43.1 23.8 9.2 54.6 52.4*
Nov 31.0 48.6 20.4 10.6 55.3 56.1

*revised


3 Vacancies

Recruitment consultants are asked to specify
whether the demand for staff from employers has Job Vacancies
changed on the previous month, thereby providing
an indicator of the number of job vacancies. The 75 Increasing rate of growth
summary indexes shown in this page are derived 70 Vacancy Index
from the detailed sector data shown on page 5. 65
60
55
50
Strong rise in demand for staff 45
The Report on Jobs Vacancies Index jumped to a twenty-two 40
month high in November. At 57.2, up from 51.5 in October, the 35
30
index signalled a robust rate of growth in demand for staff.
25 Increasing rate of decline

Permanent staff vacancies 75
Demand for permanent staff rose for the second month 70
Temp/Contract Vacancies
running in November. Furthermore, the rate of expansion 65
accelerated to the strongest since January 2008. 60
55
Increasing rate of growth

Temp/contract vacancies Increasing rate of decline 50
45
November data pointed to a third successive monthly rise in
Permanent Vacancies 40
short-term job vacancies, with growth picking up to a nineteen-
35
month high.
30
25
Other vacancy indicators 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Government data on job vacancies signalled a year-on-year
reduction in vacancies for the sixteenth consecutive month.
However, the latest drop of 26.6% was the slowest since
January.
Latest available data signalled a 37.4% annual drop in
internet-based recruitment spending during the second quarter
of 2009.
Job Vacancy Indicators
The Job Vacancies Index monitors the overall demand for Jul’09 Aug Sep Oct Nov
staff at recruitment consultancies. An index reading above
50 signals a higher number of vacancies than the previous Job Vacancy Index (recruitment industry survey)
month. Readings below 50 signal a decline compared with the 50 = no change on previous month
previous month. Total 42.5 45.1 49.3 51.5 57.2
Permanent Staff 42.4 45.0 49.2 51.5 57.4
Temporary Staff 44.1 46.9 51.0 52.3 54.8

Other key vacancy data
Annual % change

Job centre vacancies -31.9 -28.9 -28.0 -26.6 n/a
Internet recruitment -37.4 -- -- -- --

Sources: Job centre vacancies provided by Office for National Statistics
Internet recruitment spending provided by WARC.com



4 Demand for staff by sector

Recruitment consultancies are requested to compare
the demand for staff according to sector with the Demand for staff
situation one month ago.
90 Secretarial & Clerical 90 Accounting & Financial
80 80
Permanent Staff 70 P erm 70 P erm
Demand rose for seven of the eight broad types of permanent
staff monitored by the survey in November. The strongest rate 60 60
T em p
of growth was signalled for Nursing/Medical/Care workers, 50 50
followed by IT & Computing employees. Blue Collar was the
40 40 T em p
only category to register a decline in demand.
30 30
This year (Last year) 20 20
Rank Nov'09 Rank Nov'08 2002 2003 2004 2005 2006 2007 2008 2009 2002 2003 2004 2005 2006 2007 2008 2009

Nursing/Medical/Care 1 63.2 (1) (53.1)
IT & Computing 2 62.2 (2) (37.4) 90 90
Executive & Professional IT & Computing
Executive/Professional 3 61.1 (3) (34.0)
80 80
Engineer’g/Construction 4 60.2 (4) (31.5)
70 P erm 70
Accounting/Financial 5 58.5 (7) (28.7) T em p
60 60
Secretarial/Clerical 6 55.9 (5) (30.1)
Hotel & Catering 7 52.5 (6) (29.2) 50 50

Blue Collar 8 44.9 (8) (27.0) 40 T em p 40 P erm

30 30

Temporary/contract staff 20
2002 2003 2004 2005 2006 2007 2008 2009
20
2002 2003 2004 2005 2006 2007 2008 2009
Growth of demand was broad-based across all eight
temporary/contract staff sectors in November. Engineering/
Construction workers were the most in-demand, closely 90 Blue Collar 90 Engineering/Construction
followed by Secretarial/Clerical employees.
80 80
P erm
70 T em p 70
T
his year (Last year)
Rank Nov'09 Rank Nov'08 60 60
Engineer’g/Construction 1 56.9 (6) (33.5) T em p
50 50
Secretarial/Clerical 2 56.1 (4) (35.8) P erm
40 40
IT & Computing 3 55.7 (2) (37.9)
30 30
Nursing/Medical/Care 4 55.6 (1) (54.1)
Accounting/Financial 5 54.0 (8) (32.7) 20
2002 2003 2004 2005 2006 2007 2008 2009
20
2002 2003 2004 2005 2006 2007 2008 2009

Hotel & Catering 6 53.3 (5) (34.5)
Executive/Professional 7 52.5 (3) (36.2)
90 90 Nursing/Medical/Care
Blue Collar 8 52.4 (7) (32.9) Hotel & Catering
80 80
T em p T em p
70 70

60 60

50 50
P erm
40 40
P erm
Data are presented in the form of diffusion indices whereby 30 30
a reading of 50 indicates no change on the previous month.
20 20
Readings above 50 signal stronger demand than a month 2002 2003 2004 2005 2006 2007 2008 2009 2002 2003 2004 2005 2006 2007 2008 2009

ago. Readings below 50 signal weaker demand than a month
ago.


5 Staff availability

Recruitment consultants are asked to report whether
Staff Availability
availability of permanent and temporary staff has
changed on the previous month. An overall indicator 50 = no change on previous month Improving availability
90
of staff availability is also calculated.
80
Staff Availability Index

Rise in candidate availability 70

continued to ease 60

November data signalled weaker increases in both permanent 50
and temporary/contract staff availability, likely reflecting a 40
recent moderation in the rate of growth of unemployment.
30
Deteriorating availability
20
Availability of permanent staff
Permanent staff availability rose for a twentieth consecutive
Improving availability 90
month during November. However, the pace of improvement
eased further from the elevated levels seen around the turn of 80
the year to the slowest since June 2008. Temp Availability 70

60
Availability of temporary/contract staff 50
Similarly, the rate of growth of short-term staff availability was
the weakest for sixteen months in November. Around 29% of 40
respondents signalled a rise, compared with 9% that indicated Permanent Availability
30
a decline. Deteriorating availability
20
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Availability of permanent staff
Q. Is the availability of candidates for permanent vacancies
better, the same or worse than one month ago?
% % % +/- Index
2009 Jun 47.0 48.3 4.7 42.4 71.2 74.0
Jul 44.9 48.1 7.0 37.9 68.9 72.5
Aug 34.9 56.7 8.3 26.6 63.3 68.5
Sep 31.9 57.8 10.2 21.7 60.8 63.4
Oct 30.3 61.6 8.1 22.3 61.1 61.8
Nov 24.2 65.6 10.2 13.9 57.0 58.2

Key permanent staff skills reported in short supply:* Availability of temporary/contract staff
Secretarial/Clerical: Receptionists, PAs, Secretaries. Q. Is the availability of candidates for temporary vacancies
Engineering/Construction: Highways engineers. better, the same or worse than one month ago?
% % % +/- Index
Key temp skills reported in short supply:* 2009 Jun 53.9 40.6 5.6 48.3 74.1 76.7
Secretarial/Clerical: Receptionists.
Jul 47.9 45.6 6.5 41.4 70.7 70.3
Hotel/Catering: Chefs. Aug 35.3 54.7 10.0 25.3 62.6 66.4
IT & Computing: CNC programmers. Sep 34.8 55.3 9.9 24.9 62.5 63.6
Nursing/Medical/Care: Medical secretaries. Oct 33.5 55.9 10.6 23.0 61.5 62.2
Nov 28.8 62.2 9.0 19.7 59.9 60.3
*consultants are invited to specify any areas in which they have encountered skill
shortages during the latest month



6 Pay pressures

The recruitment industry survey tracks both the
Pay Pressures
average salaries awarded to people placed in
permanent jobs each month, as well as average 70
hourly rates of pay for temp/contract staff. Permanent Salaries
Increasing rate of growth

65

Permanent salaries
Average starting salaries for people placed in permanent jobs 60
rose for the first time in fifteen months in November. However,
the rate of inflation was only modest and much weaker than 55
the long-run series average.
50

Temp/contract pay rates
Hourly rates of pay for temporary/contract staff fell for a 45
fourteenth successive month in November, although the
Temp/Contract Hourly Pay Rates
latest reduction was the smallest in that sequence. Anecdotal 40
evidence suggested that high levels of candidate availability
continued to place downward pressure on pay. 35
Increasing rate of decline

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Permanent Salaries
Q. Are average salaries awarded to staff placed in permanent
UK average earnings positions higher, the same or lower than one month ago?
Data from the Office for National Statistics signalled Higher Same Lower Net Index S.Adj.
that employee earnings (including bonuses) rose by % % % +/- Index
1.2% on a year-on-year basis in the three months 2009 May 4.7 75.2 20.1 -15.4 42.3 40.7
to September. That was the weakest increase in Jun 5.1 76.5 18.4 -13.3 43.4 41.8
five months, and was driven by slower growth of Jul 6.3 76.0 17.7 -11.4 44.3 44.5
earnings in the service sector. In contrast, pay in the Aug 6.3 78.9 14.8 -8.5 45.8 45.0
manufacturing sector rose at the sharpest rate in eight Sep 4.3 87.9 7.9 -3.6 48.2 47.2
months.
Oct 7.7 83.1 9.2 -1.5 49.3 49.3
Yr/yr % chg in employee earnings (3mma) Nov 9.0 83.6 7.3 1.7 50.8 51.9

2006 2007 2008 Jun'09 Jul Aug Sep
Whole economy 4.1 3.9 3.6 2.5 1.8 1.6 1.2
Manufacturing 5.2 3.5 3.2 1.3 0.7 1.3 1.5 Temporary/Contract Pay Rates
Services 4.0 4.1 3.8 2.8 2.1 1.7 1.2 Q. Are average hourly pay rates for temporary/contract staff
Private services 4.2 4.4 3.9 2.6 1.7 1.1 0.7
higher, the same or lower than one month ago?
Index, 50=no change on previous month Y r/yr % change % % % +/- Index
70
Permanent Salaries Index 6 2009 May 3.0 74.3 22.7 -19.6 40.2 40.6
65
5 Jun 4.2 75.1 20.7 -16.6 41.7 40.9
60
55
4 Jul 2.8 80.0 17.2 -14.4 42.8 42.0
50
3
Aug 2.7 82.0 15.3 -12.6 43.7 43.5
2
45 Sep 3.1 84.9 12.0 -8.9 45.5 44.6
40 1
UK employee earnings
Oct 9.4 80.2 10.4 -1.0 49.5 46.8
35 0

30 -1
Nov 6.3 84.5 9.3 -3.0 48.5 48.1
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


7 Feature official labour market data
Early turnaround in labour market suggests
Change in unemployment v permanent placements
unemployment may peak lower than was feared
3m c hange, 000s , inv erted Index , s a, 50 = no c hange
Latest data from the Office for National Statistics (ONS) -200 75
signalled that unemployment increased by just 30,000 in -150 70
the three months to September, the smallest rise since -100 65
May 2008. The unemployment rate remained unchanged -50 60

at 7.8%, confounding analysts’ expectations of a jump to 0 55
50 50
8.0%. Moreover, overall employment actually registered
100 45
a small increase of 6,000, the first growth since July
150 40
2008. ILO unemploy ment (lef t s c ale)
200 35
250 KPMG/REC Permanent Plac ements (right s c ale) 30
Overall, the figures provided further evidence that 300 25
the job market is stabilising and raised hopes that 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
unemployment may peak at a much lower level than
was feared earlier in the year. At 2.46 million in the three Vacancies v demand for staff
months to September, the jobless total is still some way
Index , s a, 50 = no c hange s a, % y /y
below the 3 million mark that many analysts saw as
75
inevitable. KPM G/REC d e m an d fo r s taff 20
70
65 10
Although the outlook remains uncertain, amid concerns
60
over the sustainability of economic recovery and the 0
55
impact on employment of tighter public sector spending 50
next year, it is clear that the labour market has so far -10
45
shown impressive resilience. 40
ONS vacan cie s
-20
35
With the latest findings from the Report on Jobs -30
30
signalling a continuation of the recent improvement in 25 -40
labour market conditions, official data may well provide 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
further positive surprises in the coming months.
Sources: Office for National Statistics, Markit

KPMG is a global network of professional
firms providing audit, tax and
Recruitment Industry Survey
The monthly survey features original research data collected via
advisory services. KPMG LLP, a UK limited
questionnaire by Markit Economics from a panel of 400 UK recruitment
liability partnership, is the UK member firm of KPMG International, a
and employment consultancies. In 2003/4, some 1,516,000
Swiss cooperative. KPMG LLP operates from 22 offices across the
people were employed in either temporary or contract work through
UK with nearly 11,000 partners and staff. The UK firm recorded a
consultancies and over 565,500 people were placed in permanent
turnover of £1.6 billion in the year ended September 2007.
positions through consultancies. Data for the monthly survey were first
The KPMG Trademarks are the sole property of KPMG International
collected in October 1997 and are collected in the end of each month,
and their use on this report does not imply auditing by or endorsement
with respondents asked to specify the direction of change in a number
of KPMG LLP, KPMG International or any of its member firms of the
of survey variables.
information in this report.

The REC is the association for the UK’s £27
The intellectual property rights to these data are owned by Markit
billion private recruitment and staffing
Group Limited. Any unauthorised use, including but not limited to
industry with more than 8,000 recruitment
copying, distributing, transmitting or otherwise of any data appearing
agencies and 6,000 recruitment consultants in membership. There are
is not permitted without Markit’s prior consent. The publication or
over 1.2 million temporary workers registered with UK agencies and
release of any of these data prior to the general release time is an
up to one million are deployed in industry, commerce and the public
infringement of Markit Economics Ltd’s intellectual property rights.
services every day.
Markit shall not have any liability, duty or obligation for or relating
to the content or information (“data”) contained herein, any errors,
Markit Economics is a specialist compiler of
inaccuracies, omissions or delays in the data, or for any actions taken
business surveys and economic indices,
in reliance thereon. In no event shall Markit be liable for any special,
including the Purchasing Managers’ Index (PMI) series, which is now
incidental, or consequential damages, arising out of the use of the
available for 26 countries and key regions including the Eurozone and
data. Markit, PMI and Purchasing Managers’ Index are all trademarks
BRIC. For more information e-mail economics@markit.com or call
owned by The Markit Group.
+44 1491 461000.


Kpmg Report On Jobs Dec09

Recommended

Recommended

More Related Content

Viewers also liked

Viewers also liked (10)

Similar to Kpmg Report On Jobs Dec09

Similar to Kpmg Report On Jobs Dec09 (20)

Kpmg Report On Jobs Dec09