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Shortage of job seekers stokes London recruitment crisis

·2-min read
London workers face a jobs bonanza as businesses attempt to hire post-Covid  (PA)
London workers face a jobs bonanza as businesses attempt to hire post-Covid (PA)

The London recruitment crisis caused by a rush of post-pandemic hiring as many jobseekers leave the capital shows little sign of abating, according to the latest research from global accounting giant KPMG and the Recruitment and Employment Confederation (REC).

Anna Purchas, London office senior partner at KPMG, said the capital was facing “the sharpest fall in permanent labour supply in the country” and warned that “the talent shortage in the capital has the potential to impact plans for growth significantly.”

Rapid growth in permanent vacancies across London continued in April, easing only fractionally from a joint 11-and-a-half-year high registered in March. The increase in London was faster than the national trend.

Neil Carberry, CEO of the REC, said: “The labour market has been tightening for months on end, driving near-record growth in starting salaries for new staff. With vacancy numbers also historically high, this is a great time to be looking for a job – and a pay rise to help meet the rising cost of living.”

Some companies have pulled back on hiring for permanent positions only due to candidate shortages, according to a survey of 100 recruitment and employment consultancies.

The number of open temp jobs in London also expanded sharply in April. The upturn was not as quick as that seen for permanent roles and was weaker than the expansion seen across the UK as a whole.

The number of candidates available for both permanent and temporary jobs continued to plummet in April, driving continued “sharp” growth in startling salaries.

Purchas said: “It’s evident that despite the economic backdrop, businesses are focussed on growth.”

Rates of pay inflation for permanent and temp staff eased to four- and three-month lows respectively, evidence of reduced company budgets as costs soar.

Of the four monitored English regions, the sharpest uplift in permanent placements was seen in the Midlands during April, whereas the North of England registered the weakest expansion.

The report was compiled by S&P Global on behalf of KPMG and REC.

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