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Langley James IT Recruitment Market Review – the North – April 2019

May 15, 2019 . 9:00 am

Key findings from the April survey:
– Modest rise in permanent staff appointments
– Fastest increase in contract pay for nine months
– Candidate supply falls at softer rate

Commenting on the latest survey results, Nicola Quayle, Office Senior Partner at KPMG in Manchester said:
“The North continues to buck the national trend, delivering an albeit modest increase in permanent appointments for the second month running. Despite ongoing uncertainty, aspirational businesses in the region are clearly kicking on with their growth plans which is encouraging to see.
“Workers are still exercising caution when moving within the job market, slowing the availability of skilled talent, which will frustrate those in business who want to expand now. While there is appetite to take on workers, employers won’t want to overstretch themselves and are still hungry for temporary labour that will offer some flexibility if trading conditions change dramatically.”

Recruitment & Employment Confederation Chief Executive Neil Carberry said:
“Employers are turning to temporary work to support their business and offer people opportunity while the long-term economic picture is unclear. “We should be proud of how our jobs market has adapted to challenging circumstances. Resolving Brexit will bring some certainty, but we must also take bold steps to fix the underlying problems suggested by these figures.”

Staff Appointments

Permanent placements rise for the second month in a row
Recruiters in the North of England recorded a second successive monthly increase in permanent staff appointments during April. The rate of growth was unchanged from March and moderate overall. Anecdotal evidence from recruitment firms indicated that increased demand for workers drove the latest rise in permanent staff appointments.
Further sharp increase in contract billings
Contract billings in the North of England rose markedly at the start of the second quarter. However, the rate of increase eased from March and was slightly softer than the historical average. Some recruiters mentioned rising business requirements at their clients when explaining the latest rise.

Job Vacancies
April data pointed to a further rise in demand for both permanent and contract staff in the North of England. The number of permanent staff vacancies increased sharply, registering the fastest rate of growth for six months.
Moreover, permanent staff demand rose at a quicker pace than the UK average. Similarly, contract positions in the North of England increased a sharper pace than in March. The rate of expansion reached its strongest since
last December.

Staff Availability

Permanent labour supply declines at slower pace
As has been the case in each month since February 2013, permanent staff availability in the North of England deteriorated during April. The rate of decline eased to its softest since November 2018, but remained sharp overall. When explaining the latest fall in permanent candidate numbers, recruiters often suggested that workers were reluctant to change jobs amid ongoing Brexit uncertainty.
Softest reduction in contract worker availability for six months
Although contract staff availability in the North of England continued to fall at the start of the second quarter, the rate of deterioration eased to its softest for six months. Recruitment consultancies typically attributed the latest decline in contract labour supply to a generally low level of unemployment and a lack of suitably skilled candidates.

Pay Pressures
Slowest increase in permanent starters’ pay for seven months 
Recruiters in the North of England reported a rise in permanent starting salaries for the eighty-sixth month in a row during April. However, the rate of inflation softened for the second month in a row, reaching its slowest since last September. Though still sharp overall, the pace of increase was softer than the UK average.
Quickest rise in contract wages since last July
Wages paid to contract staff in the North of England continued to rise sharply at the start of the second quarter. Moreover, following the slowest increase for five months during March, the rate of inflation accelerated to the quickest since July 2018.

Official Data: UK Average Weekly Earnings
Data from the Office for National Statistics signalled that average weekly earnings across the UK rose by 5.4% year-on-year to £637 in the final quarter of 2018.
London saw the strongest annual rise, with pay up 13.1% to £846. Meanwhile, the weakest increase was in the South East, with average weekly earnings rising by just 0.5% on the previous year to £685.

Regional Comparison

Staff appointments
Permanent staff placements across the UK fell for the second month in a row during April. However, the rate of decline eased from March and was only marginal overall. At the regional level, three of the four monitored English locations recorded lower permanent staff appointments, with the North of England being the only exception.
In contrast, contract billings in the UK continued to increase at the start of the second quarter. The latest rise extended the current sequence of growth to six years. Moreover, the rate of increase accelerated from March and was solid overall. The Midlands was the only monitored English region to record a decline in contract billings during April.
Candidate availability
Although permanent labour supply across the UK continued to fall sharply in April, the rate of reduction was the least marked in just over one year. At the regional level, there were slower declines recorded in each of the four monitored English locations. The quickest deterioration in availability was registered in the South of England, while the slowest was recorded in the Midlands.  
Similarly, contract staff availability at the national level fell for the seventieth month in a row during April. That said, the rate of decrease eased to its slowest since January 2017. Regional data pointed to softer declines in London and the North of England, and faster falls in the Midlands and the South of England.
Pay Pressures
Permanent starting salaries continued to increase sharply across the UK in April. That said the rate of inflation edged down to the slowest for two years. The North of England and London registered less robust rises in starting salaries. However, rates of increase picked up in the Midlands and the South of England.
Conversely, hourly pay rates for contract staff in the UK grew at the fastest pace for three months during April. The North and the South of England recorded quicker rises in contract wages, whereas the Midlands signalled the slowest rate of pay inflation since last October. Notably, London saw wages rise at a solid rate following a fractional decrease in March.

About Langley James
Langley James was founded in 1999 by James Toovey, a highly respected recruitment industry professional.  James wanted to provide something unique: a bespoke recruitment service which was founded on service excellence.  With offices in London and Chester, we are now providing our recruitment services throughout the world and over the last 19 years have worked with some of the most respected companies.

The average time from taking a role…
– and Delivering a Qualified Shortlist of Candidates          3 days
– and First Confirmed Interview                                             5 days 
– and Confirmed Placement                                                     8 days

To find out why so many companies turn to Langley James for support in fulfilling their IT recruitment needs, call and speak to one of our specialist consultants today on 0207 788 6600.

In conjunction with: IHS Markit and sponsored by the Recruitment and Employment Confederation.