Starting salaries continue to rise at near-record pace amid sharper drop in candidate supply

The latest KPMG and REC, UK Report on Jobs survey signalled a further steep increase in hiring activity at the start of 2022. Permanent placement growth eased slightly since December, however, while the upturn in temp billings gathered pace.

The overall availability of candidates deteriorated much quicker in January, driven by a more drastic fall in permanent staff supply. Intense demand for workers and few candidates led to further marked upward pressure on rates of starting pay. Starting salaries increased at the third-fastest pace on record, while temp pay growth remained sharp despite easing to a seven-month low. Vacancies data meanwhile, showed that demand for workers continued to rise at a historically sharp pace, despite overall growth edging down to its lowest for nine months.

Demand for staff continued to rise sharply across both the private and public sector during January. The quickest increase in vacancies was for permanent roles in the private sector, while the softest was seen for temp workers in the public sector.

Demand for permanent workers rose across all ten monitored job sectors at the start of 2022. The quickest increase in demand was seen for IT & Computing, followed by Nursing/Medical/Care. The slowest upturn in vacancies was seen in the Retail sector.