Rise in temping a sign of employer wariness
Dec 5 2007 by Peter McCusker, The Journal
DEMAND for permanent staff and the number of job vacancies have fallen in the past year, suggesting that the credit crunch is tightening its grip on the economy, according to a new report.
The Recruitment and Employment Confederation (REC) said there had been a weakening of jobs growth in the market for permanent staff, although temporary work continued to expand.
Research among 400 recruitment firms showed that the growth in permanent jobs hit a near two-year low while wage growth also fell. In contrast, there was a “robust” increase in temporary and contract placements, while wage increases in the sector edged up to a four-month high.
The report also highlighted a decline in the number of workers available for temporary and permanent jobs in November.
Helen Reynolds, acting chief executive of the REC, said: “With temporary billings continuing to increase at a robust rate, this month’s report highlights the value of a flexible workforce for employers.
“If businesses are to continue to benefit from temporary workers, who can be available for assignments in a matter of hours, it is essential that we do not limit job-creation opportunities through additional regulation, such as the Agency Workers Directive being discussed in Brussels.
“Limiting temping job opportunities will be particularly harmful for new entrants into the labour market such as lone parents. New entrants can use temporary work as a stepping stone into permanent employment to regain their confidence and gain some valuable work experience.”
Alan Nolan, director at KPMG, which helped with the research, added: “What we are seeing is that the credit crunch is tightening its grip over the economy.
“While the job market remains broadly robust, this latest report suggests an underlying weakening with both demand for permanent staff and vacancies down.
“At the same time, for temporary staff, demand and pay growth have picked up, perhaps a sign that while the business environment remains comfortable at present, employers are becoming more wary about the outlook, and want to increase flexibility.”
