Hiring slowdown eases as permanent placements steady in February, report finds

The North saw an increase, while the Midlands recorded its first decline in three months. 

Temp billings fell in all regions except the Midlands, where growth was the slowest since last August.

Engineering was the only sector with better demand for permanent staff in February. 

The other nine categories saw fewer vacancies, with Retail and Hotel & Catering recording the steepest falls. 

All sectors saw a drop in temp demand, but engineering had only a slight fall in temp jobs, while retail saw the sharpest reduction.

Jon Holt, group CEO and UK senior partner at KPMG, said: “Despite a marginal fall in hiring last month, the jobs market was showing its strongest signs of improvement in three years, with hiring at its closest point to turning positive. 

“However, we need stability for sustained growth, and yet again businesses are facing unexpected economic shocks because of global events out of their control. 

“Resilience is now the new normal, so it is likely we may see these signs of recovery stall again in the near term as chief execs take stock.”

Neil Carberry, CEO of REC, said: “While February’s report is by no means a source of unalloyed celebration, it does suggest that the worst of the hiring slowdown has passed. 

“There may still be a few bumpy months to come, especially in light of global instability, but the stabilising trend we have seen so far this year has continued. 

“It is notable that regions and sectors most exposed to the industrial strategy seem to be the liveliest.”

Carberry added: “A real turnaround requires growing confidence among businesses and consumers. 

“There is cash in the system to spend if consumers and businesses feel better – a core goal of policy should be to tackle this by reducing the cost of doing business, which will in turn address the rising cost of living. 

“From a more practical approach to the Employment Rights Act, to energy costs, the impact of business tax rises and planning reform, there is plenty to do that could back businesses to grow and create jobs sustainably.”

Kirsty Ross, proposition director at People’s Partnership, said: “Automatic enrolment has laid a strong foundation for retirement saving, but engagement cannot be taken for granted. 

“During periods when hiring slows or job movement increases, some savers may reduce or pause contributions or disengage from their pensions entirely. 

“Even short interruptions to pension saving can have a significant long-term effect.”

Ross added: “This is why clear and consistent communication is so important. Employers play a key role in reinforcing the value of workplace pensions, particularly the benefit of employer contributions and tax relief. 

“Helping members understand what they receive, and what sustained contributions means for their future, can support better long-term decisions for savers.

“Retirement saving is most effective when it remains consistent.”

She said: “Encouraging and supporting members to stay engaged, even during periods of economic instability, is central to helping them achieve better long-term outcomes.”