Midland firms ‘poised to invest and grow’- report
Businesses in the Midlands are ready to invest and grow by recruiting new staff – but are being held back by potential weaker demand.
The latest KPMG and REC UK Report on Jobs survey, compiled by S&P Global, pointed to the Midlands as the best performer of the four English regions covered.
The region recorded the softest fall in permanent placements, and one much weaker than that seen at the UK level. Moreover, the Midlands was the sole region to record temporary billings growth in February.
Signs of a muted jobs market were apparent as candidate availability continued to rise markedly, while there was a fall in permanent job vacancies for the first time in just over three years. In turn, rates of increase in permanent starting pay and temp wages eased on the month and were slower than the respective averages seen across the survey history.
Kate Holt (pictured), People Consulting partner for KPMG in the Midlands, said: “The deadlock between economic uncertainty and hiring decisions continued into February. Businesses in the Midlands are ready to invest and grow – including taking on new staff – yet the reality is they’re being held back by the prospect of weaker demand.
“Permanent hiring has been slowing over the last few months, but we saw green shoots as the Midlands registered growth in both temporary billings and vacancies. Temping keeps people in work when firms are uncertain about the future and keeps the economy ticking.
“Businesses needed the Chancellor to deliver a Budget that would drive investment, boost economic growth and help productivity bounce back. We will have to wait and see if the measures announced will be enough to improve the economic outlook."
Neil Carberry, REC chief executive, said: “As inflation is falling back to target earlier than expected, it’s time to get the focus on growth. This month’s survey shows the market slowing, a sustained decrease in permanent staff appointments across the Midlands and easing pay growth inflation for permanent and temp workers in the region.
“Having said that, there is a demand for workers with accounting and financial and IT skills in the region.
“Given recent news about GDP dropping, this overall picture is no surprise – but it is certainly still quite resilient by comparison with previous recessions. We know the economy has the potential to create jobs and opportunities – but it can only do that sustainably if we can get economic growth going.
“Following the Budget last week, which didn’t address some of the key drivers of growth like skills, infrastructure and reducing the cost of investment and employment, all eyes are on the Bank now. Lower interest rates will help build firms’ confidence to invest.
“The temporary labour market is the unsung hero of the economic uncertainty of recent years. It keeps the cogs of the economy turning amidst uncertainty and labour shortages – but it still needs nurturing. As we approach the General Election, businesses will be looking to politicians for commitment on this, and reforms of regulation that will support it from IR35, to regulating of the umbrella market and delivering flexibility to the Apprenticeship Levy.”
The KPMG and REC, UK Report on Jobs: Midlands is compiled by S&P Global from responses to questionnaires sent to around 100 recruitment and employment consultancies in the Midlands.
