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Demand for contractors continues to fall

by Susie Hughes at 10:50 12/06/12 (News on Business)

Agencies report that billings for contractors and temp workers decreased for the sixth month running, and at the fastest pace since July 2009.

Temporary/contract pay rose at the weakest rate in five months. The monthly report from agency group REC and accountants KPMG also showed that recruitment consultancies signalled another modest rise in permanent staff placements during May, but the rate of growth was the weakest in the current five-month period of expansion. Permanent staff salaries rose at the fastest rate for eight months in May, but the increase was only modest and well below the long-run series average. ons in terms of both permanent and temporary jobs during May, while London continued to underperform. By sector, demand for staff was reported to have risen at the fastest rates for IT and Engineering/Construction staff. Kevin Green, Chief Executive of the Recruitment & Employment Confederation, said: “This month’s data shows employers are becoming more cautious about hiring and while there is still growth in permanent placements, the figures have been getting weaker over the last two months. Clearly the economic backdrop and the eurozone crisis are making some employers think twice before taking on new staff. Advertisement “What’s interesting are the niche areas that are seeing much stronger growth than the national average. In every month this year, the engineering and IT and computing sectors have seen solid increases in the number of workers recruited for permanent roles. And compared to other parts of the country, employers in the Midlands are confident about hiring more temporary and permanent employees. “The 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 – such as drivers, chefs and a whole range of IT expertise. “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.” Tweet -- If you wish to comment on this article, please log in and use the Reply button below. Registering is free and easy - see 'Join Shout99'. - Susie Hughes © Shout99 2012

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