Temporary worker demand highest since 1998

Wednesday 10 September 2014

Demand for umbrella company contractors, limited companies and other self employed professionals is now increasing at a faster pace than it has been for more than 15 years.

This is according to the latest Report on Jobs: Midlands from KPMG and the Recruitment and Employment Confederation (REC). It says that demand for both permanent and temporary employees rose strongly during August and that, for the latter, demand is now rising at the fastest rate seen since May 1998.

The survey suggested there would be a further rise in temp billings and that the current sequence of growth is likely to cover 30 months. Expansion was measured to be the weakest level seen since July 2013 but the rate of expansion was marked and faster than average.

As is to be expected during periods of high demand, the number of temporary candidates available fell somewhat, making August the 13th month in a row where there has been a decrease. While this decline was felt across the country, it most acute in the Midlands.

Temporary workers also may have enjoyed a rise in their hourly rates of pay as the results show that these increased at a marked pace in August. However, it was a little slower than the peak seen in July. For the thirteenth month in a row, rates of pay in the Midlands rose faster than the national level. Meanwhile, the north of England saw the fastest rise in hourly pay rates for August, while London saw the slowest.

Chief executive officer for REC Kevin Green said that these results help to debunk the idea that the jobs market in the UK is centred around London. He added that the reason why pay rates are rising faster outside of the capital is because recruiters are trying to be more competitive and to attract and retain more talent from different regions.

He also added that temporary and permanent jobs were not only increasing across regions but also in a mixture of sectors, such as construction, IT and engineering.

Andrew Fahey, Commercial Director at Brookson said: "These figures continue to support the idea that there has never been a better time to become a contractor or start up a business. Larger companies are seeing the benefits of working with individuals as and when they need them, ensuring they can employ someone with the right skills for a particular job. Similarly, contracting affords people more freedom to select the jobs that are best suited to their skill set.

"Of course, one of the trickiest aspects of delving into contracting is making sure accounts are in order, which is why anybody choosing this way of working should seek out an expert accountant in this field."

However, both Kevin Green and Midlands regional chairman at KPMG Mike Steventon warned that the skills shortage could hinder growth in the appointment of temporary and permanent workers across the country. The warning signs were raised as the number of appointments made in the Midlands during August slowed somewhat.

By Victoria McDonnell

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