— KPMG/REC: UK Jul Permanent Placements 60.2 vs 60.7 In June
— KPMG/REC: UK Jul Temporary Placements 54.3 vs 57.0 In June
— KPMG/REC: UK Jul Vacancies Index 57.8 vs 59.4 In June
— KPMG/REC: UK Jul Permanent Salaries Index 56.1 vs 53.9 in June
— KPMG/REC: UK Jul Permanent Salaries Index Highest Since Feb’08

LONDON – The pace of expansion in the UK permanent jobs
market continued to slow at a steady rate in July, while pay inflation
in this sector rose, according to the latest survey of the labour market
for KPMG/REC and compiled by Markit.

The permanent jobs index remained comfortably above the 50
contraction/expansion level in July, marking 12 months of consecutive
growth in both temporary and permanent job markets. But the temporary
jobs index fell from 57.0 to 54.3 in July – the weakest pace of growth
in temporary placements in nine months.

The July permanent placements index came in at 60.2, down from 60.7
in June and 61.3 in May.

The KPMG/REC survey shows pay growth for permanent staff picking
up. The permanent salaries index rose to 56.1 from 53.9 in June. This
marks the strongest rate of inflation since February 2008. The BRC said
that the rise in salaries is due to stronger demand for permanent staff
and a shortage of quality candidates.

However, the rate of growth of temporary hourly pay rates weakened
in July, with the index dropping to 51.8 from 52.4 in June, marking the
slowest rate of growth in four months.

The survey also found a reduced rate in growth for job vacancies,
with the index falling from 59.4 in June to 57.8 in July, the lowest
rate of growth for eight months.

Bernard Brown, head of Business Services at KPMG, warned that the
jobs market could weaken if government austerity measures bite.

“The sharp decline in the demand for healthcare professionals comes
as a direct result of government cutbacks and cost reduction in the NHS,
and is a sign of things to come as the public sector prepares for more
spending cuts which are likely to impact the jobs market further,” he
said.

The latest official data showed earnings growth easing and
employment picking up. In the three months through May average weekly
earnings from regular pay were up just 1.8% on the year, compared to up
1.9% in the three months through April. The number of people in
employment in March to May was only 5,000 down on a year ago and up
160,000 on the previous thee months.

These KPMG/REC data suggest, however, that pay pressures from
permanent employees are mounting.

–London newsroom: 4420 7862 7491; email ukeditorial@marketnews.com

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