Last reviewed 17 September 2020

The UK Report on Jobs survey conducted by the REC (Recruitment and Employment Confederation) and KPMG shows a renewed upturn in hiring activity in August as more parts of the economy reopened following easing of coronavirus restrictions.

However, permanent placements rose only slightly while the number of temporary staff being taken on expanded at the quickest rate for 20 months.

While the availability of candidates rose at the second-steepest rate in over 20 years of data collection, amid reports of widespread redundancies, overall demand for staff fell further in August.

Consequently, REC reported, recruiters signalled further drops in starting salaries and temps’ wages.

Chief Executive Neil Carberry said: “Past recessions show that temporary work bounces back more quickly — it is one of our jobs market’s biggest strengths and that’s really showing now. Slower growth in permanent staff appointments is concerning. It reflects the uncertainty businesses face about what will happen over coming months with the pandemic and Brexit”.

He called on the Government to agree a trade deal with the EU and to support businesses to keep people employed through measures such as a reduction in employers’ National Insurance contributions (NICs) and greater flexibility on skills support.

Commenting on the Report, KPMG vice chairman James Stewart agreed that the winding down of the furlough scheme and worries about a Brexit deal were among the issues preventing the jobs market moving back towards levels seen pre-Covid.

“This paves the way for Government to not only provide short-term support but also to offer jobseekers the means to retrain and upskill, helping the recovery in jobs and reviving the UK’s productivity growth,” he concluded.

Comment by Croner Associate Director Paul Holcroft

As HR professionals, it is important to find alternative, business sound ways, to balance fluctuating demand from customers and the financial strain caused by coronavirus on businesses, meaning they cannot now offer as many permanent positions as they once did.

Employees may see an increase in temporary/casual work being offered as they are forced to take more diverse steps to fix the bruised UK economy.

This hiring method also makes it easier to downsize a workforce if need be, at least until the economic situation improves.