A weaker economic climate resulted in a softer fall of hiring activity across the South West at the end of 2023, according to the latest KPMG and REC, UK Report on Jobs survey.
The report cited the availability of candidates continued to rise at "a historically sharp pace", with recruiters often noting that redundancies and muted demand for workers had driven the latest increases in both permanent and temporary staff supply. Moreover, vacancies for both job roles declined in December.
However, the report revealed that rates of starting salary and temp pay inflation began to climb from lows in November.
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The KPMG and REC, UK Report on Jobs: South of England is compiled by S&P Global from responses to questionnaires sent to around 150 recruitment and employment consultancies in the South of England.
Of the four monitored English regions, only the Midlands recorded a steeper decline in permanent staff appointments than that seen in the South of England.
David Williams, senior office partner at KPMG in Bristol, said: "Employers in the South have continued to remain cautious in the face of general uncertainty about the UK’s economic outlook. The contraction of both permanent and temporary vacancies in December point to both a lack of churn in workplaces, with prospective candidates less willing to jump ship, and an unwillingness from employers to invest in expansion through recruitment.
“We’re expecting that this new year will bring a sustained fall in inflation and, at some point, some reversal of the Bank of England’s interest rate hikes. With that in mind, forward-looking employers may begin to ease their hesitancy to recruit and expand – though this must be weighed against wage budget pressures, with both temp pay and salaries for permanent workers having increased in December.”
Neil Carberry, REC chief executive, added: “The slowdown in our labour market seems to be easing a bit in South of England. Given that December is a time when employers generally postpone activity into the new year, this is a positive sign that the labour market is weathering the current economic storm.
“Recruiters went into 2024 with hope that an upturn is coming, based on feedback from clients. Driving this economic growth would be a huge benefit for us all, leading to more successful firms, higher pay, and the ability to cut taxes and fund public services. But the growth must come first. The Chancellor has already set a date for the Budget – he should use it to set out steps that set firms free to grow the economy, from skills reform to regulatory change, including a more balanced debate on immigration for work and its impact on growth."
