Report on Jobs: Slower growth of salaries in September

Report on Jobs: Slower growth of salaries in September

"The monthly Report on Jobs, published by The Recruitment and Employment Confederation (REC) and KPMG, reports its findings from September 2014.

Also on

Key points:

  • permanent placements rise at slowest rate in ten months
  • growth in starting salaries moderates to four-month low
  • temp pay rises at fastest pace in nearly seven years


The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs – published today – provides the most comprehensive guide to the UK labour market, drawing on original survey data provided by recruitment consultancies.

Slower rise in permanent placements…

Recruitment consultants signalled a further increase in permanent staff placements during September. Although strong, the rate of growth eased to a ten-month low.

...but temp billings increase at faster rate

Agencies’ temporary/contract staff billings rose at a strong and accelerated pace in September. The latest expansion was the seventeenth in as many months.

Candidate availability falls further...

Tight candidate availability persisted in September, with marked declines in both permanent and temporary staff supply signalled.

...maintaining upward pressure on pay

Growth of permanent staff salaries remained strong in September, despite easing to a four-month low. Hourly pay rates for temporary/contract workers rose at the fastest pace since November 2007.

Regional and sector variation

Growth of permanent staff placements was broad-based across the four monitored English regions during September. The North saw the strongest increase, while the slowest rise was signalled in London. Growth of temp billings was fastest in the Midlands during September. The South posted the weakest expansion.

 Demand for staff rose at a considerably stronger pace in the private sector than the public sector during September. The fastest growth rate was indicated for private sector temporary vacancies, while the slowest rise was signalled for public sector short-term roles.

 Engineering was the most in-demand category for permanent staff during September, as was the case one year previously. The slowest rise in demand was reported for Hotel & Catering workers. Nursing/Medical/Care remained top of the demand for staff ‘league table’ for short-term roles in September, closely followed by Engineering. The slowest growth was signalled for Executive/Professional roles.


Bernard Brown, Partner and Head of Business Services at KPMG, comments: “Buoyancy is back in British businesses, with low and falling unemployment evident today and the promise of lower corporation tax rates, tomorrow." Combine the two and it would be easy to assume that the only curve we will see is an upward one, yet there are still areas of the UK where the signs suggest we are not quite ready to turn the corner. Youth unemployment is, for example, still too high and the next few months will be a critical test of how businesses can help get the new generation of workers onto the employment ladder.

 “It won’t be easy as the latest figures suggest that as many organisations come to the end of their financial year, purse strings have been tightened and recruitment decisions are put off until new budgets are agreed. With permanent placements slowing to a ten month low, perhaps the uncertainty caused by political crises across the globe are beginning to affect decision-makers’ confidence."

“At the same time wages continue to dominate debate around the strength of the labour market. Starting salaries might look healthy, and are undoubtedly tempting some people to move, but the reality is that employers will soon reach a ceiling beyond which they won’t be able to throw more cash around to land the right candidate. It also seems that the incentive for taking on temporary roles is strengthening as pay packets improve, and if the cost of living continues to rise as expected, we may yet see candidates forced to choose between securing financial rewards in short bursts or long-term security. As we enter the tail end of the year, the hope must be that this is a short-term blip, rather than heralding a winter of discontent." Kevin Green, REC chief executive, says: “Once again more people have secured permanent and temporary jobs via recruiters than in the previous month, a sign of the continued strength of the UK’s labour market. Hourly pay for people on temporary contracts has risen at the fastest pace for nearly seven years, which shows that employers are bringing in temps and contractors with the skills they need quickly and are willing to pay to do so.

“The increasing lack of candidates continues to be a worry as shortages spread across more industries. It’s not just engineers and IT specialists that recruiters are finding it hard to source – blue collar roles like bricklayers, drivers and electricians are getting harder and harder to fill too.”

Full reports and historical data from the Report on Jobs are available by subscription. Please contact 




For further information, please contact:


Mike Petrook, KPMG Press Office

T: 020 7311 5271

M: 07917 384 576



Markit Economics (technical/data queries)

Jack Kennedy, Senior Economist

T: 01491 461087


KPMG Press Office: +44 (0) 207 694 8773


Note to Editors:

The Report on Jobs is a monthly publication produced by Markit on behalf of the Recruitment & Employment Confederation and KPMG. The report features original survey data which provides cross-sector and pan-region analysis of the UK labour market, drawing on original survey data provided by recruitment consultancies.

The Report features original research data from Markit, collected via questionnaire from a panel of 400 UK recruitment and employment consultancies. In 2010/11, some 1,049,333 people were employed in either temporary or contract work through consultancies and 604,193 people were placed in permanent positions through consultancies. Data for the monthly survey were first collected in October 1997 and are collected at the end of each month, with respondents asked to specify the direction of change in a number of survey variables.

All Index numbers are calculated from the percentages of respondents reporting an improvement, no change or decline. These indices vary between 0 and 100 with reading of exactly 50.0 signalling no change on the previous month. Readings above 50 signal an increase or improvement; readings below 50 signal a decline or deterioration. Reasons given by survey respondents for any changes are analysed to provide insight into the causes of movements in the indices and are also used to adjust for expected seasonal variations.

Markit do not revise underlying survey data after first publication, but seasonal adjustment factors may be revised from time to time as appropriate which will affect the seasonally adjusted data series. Historical data relating to the underlying (unadjusted) numbers, first published seasonally adjusted series and subsequently revised data are available to subscribers from Markit. Please contact

A regional Report on Jobs series is now available comprising four regional reports tracking labour market trends across the Midlands, the North of England, the South of England and London. The reports are designed to provide a comprehensive and up-to-date guide to labour market trends and the data are directly comparable with the UK Report on Jobs.

About KPMG

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 11,500 partners and staff. The UK firm recorded a turnover of £1.8 billion in the year ended September 2013. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 155 countries and has 155,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

About Recruitment and Employment Confederation

15 Welbeck Street, London, W1G 9XT. Tel: 020 7009 2100. Fax: 0207 935 4112 Website:

The REC is the professional body representing the UK’s £24.6 billion private recruitment and staffing industry with more than 8,000 recruitment agencies and 6,000 recruitment consultants in membership. There are more than 1 million temporary workers registered with UK agencies who are deployed in industry, commerce and the public services every day.

About Markit

Markit is a leading, global financial information services company with over 3,000 employees. The company provides independent data, valuations and trade processing across all asset classes in order to enhance transparency, reduce risk and improve operational efficiency. Its client base includes the most significant institutional participants in the financial market place. For more information, see

© Copyright in the Report on Jobs, including the Report on Jobs survey data, is owned by Markit Economics Limited. Distribution or storage including databasing by any means including, without limitation, electronic distribution is not permitted without the prior consent of Markit.


This article represents the views of the author only, and does not necessarily represent the views or professional advice of KPMG in the UK.

Connect with us


Request for proposal



KPMG’s new-look website

KPMG’s new-look website