Demand for Staff in Scotland Softens

August 21, 2012 /

The latest Bank of Scotland Report on Jobs indicated a further loss of momentum for the Scottish labour market in July.

Demand for staff increased at a weaker rate, while Scottish recruiters placed fewer people into permanent work and saw only a moderate rise in temp staff billings.

Concurrently, average salaries paid to permanent staff fell for the second month running and to the greatest extent since September 2010.
The Bank of Scotland Labour Market Barometer – a composite indicator designed to provide a single figure snapshot of labour market conditions – posted only slightly above the 50.0 nochange mark in July, indicating only a fractional improvement in the Scottish job market.

At 50.2, down from 52.3 in June, the Barometer was at its lowest level in the current sequence of improvement (since November 2010).

Donald MacRae, Chief Economist at Bank of Scotland, commented: “The Scottish labour market showed a marginal improvement in July but is losing momentum. The number of people appointed to permanent jobs declined for the first time this year showing the effect of the
current slowdown in the economy. However, the number of vacancies continued to increase giving hope that the upwards trend in employment can be maintained.”

Permanent placements fell to the greatest extent in Dundee, while Edinburgh was the only region to post a reduction in temp staff billings in July. Glasgow-based recruitment agencies posted the strongest deterioration in permanent staff availability. Job consultancies in Dundee reported the fastest rate of decline in the number of
candidates seeking temporary work.

Recruitment firms in Dundee recorded the strongest reduction in permanent salaries in July, while temp hourly pay rates was unchanged from June in both Dundee and Glasgow.

Average permanent salaries fell for the second month running in July, with the rate of decrease the sharpest since September 2010. Temp hourly pay rates increased over the month, but the rate of wage inflation was slower than the long-run series average.

Permanent staff placements fell for first time since last December. Temp staff billings increased in July, reversing the decline in June. The rate of growth was only modest, however, and weaker than the long-run series average.

Demand for permanent staff rose further during July, but the latest increase was only moderate and the weakest since January. Vacancy growth for the temporary labour market slowed to a four-month low.

The availability of permanent staff deteriorated for the fifth consecutive month in July. July data indicated a modest decline in the availability of temporary and contract staff.

Five employment sectors posted a larger number of permanent job vacancies in July. However, with the exception of Nursing/Medical/Care, the rates of vacancy growth all slowed from that recorded for June.

Sector data indicated that six sectors had an increased number of available temp job roles in July. Both the Nursing/Medical/Care and Accounts & Financial sectors posted a lower number of temp vacancies over the month.


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