The ongoing drop in contract numbers is finally slowing, and the private sector is showing “robust improvements” that are helping offset public sector losses. That’s according to the July Report on Jobs from KPMG and the Recruitment and Employment Confederation (REC).
Contractors hoping for dramatic improvements in contract opportunities following a sluggish June, which was affected by the long Jubilee weekend, will be disappointed by the headlines of the latest report. These include the fact that contract rates and temporary staff pay decreased for the second month in July, although only marginally. In addition, some of the 400 UK recruitment and employment consultancies who took part noted that contracts coming to an end were not all being replaced.
But the report does highlight an important advance: despite July showing an eighth consecutive month of contract and temporary staff contraction, the pace of decline has eased to its slowest since February 2012. There were also regional variations, with drops in London and the North of England being offset by rises in the Midlands and the South.
There is cheering news for engineering and construction contractors, with the July report confirming the “solid growth” of contract opportunities for them, helping place engineering and construction in second place in the contractor demand tables. IT and computing contracts came in fourth place, and executive and professional in sixth, but accounting and financial saw a sharp drop to eighth place. The other places were held by sectors, such as secretarial and catering, that tend to be dominated by temporary staff rather than contractors.
Taking into account the overall market feedback provided by the July Report on Jobs, KPMG partner Bernard Brown notes that “there is still a high degree of uncertainty”. He feels that the ‘Olympic effect’, which has hit many parts of the UK economy, has combined with the traditionally quiet summer period to slow the growth of new opportunities.
Brown says: “The real story of recovery will ... probably only start to emerge in the autumn as the true impact of the Olympics begins to emerge.”