Analysis: The job market starts to slow

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Analysis: The job market starts to slow

A graph showing the fluctuations in the jobs market resembles a mountain range with a chasm covering the last few months of 2008 and the early part of last year before heading back upwards.

But the graph is now heading downwards again after managing to get to levels enjoyed before the chasm of the recession and those that monitor the market are worried.

They have reason to be because in the space of just three months things have gone from being fairly healthy to slipping back into decline. The first half of this year was one of monthly improvements but the figures for September show that the advances made are now in reverse.

The latest Recruitment and Employment Confederation (REC) and KPMG figures for September show a decline back to the levels of October 2008 and mark a low for the year so far.

Overall the jobs market saw permanent staff placements growing at the slowest rate for a year and salary pressure also dropping.

Specifically in the IT sector the worry was that it slipped down the tables in terms of being the most robust sector as accounting and financial vacancies and hotel and catering along with construction were more popular.

There were still certain skills in demand with enterprise software sales, security, cloud computing specialists and net developers all wanted on a permanent basis with web developers wanted for temporary work.

Some of the blame for this overall downturn is the long awaited impact of public spending costs, which are filtering through even before the Spending Review provides the full detail.

Having followed through the progress of the recovery in the jobs market and read the comments of those involved with compiling the figures at REC and KPMG the tone of the latest remarks are very different from the upbeat but cautious comments earlier this year.

"September's Report on Jobs shows that the jobs market is starting to flat line and may herald a 'double dip' in employment. Whilst there is marginal growth, these figures are the worst we have seen for a year," said Kevin Green, chief executive of REC.

"The Government must do everything possible to avert the threat of increasing unemployment. This must include avoiding new regulation that could restrict businesses and jobs growth. How the Government decides to implement the Agency Workers Regulations will be its first major test in cutting red tape on business," he added.

The number of people potentially adding to the job seeker numbers as the cuts bite has the potential to keep the slowdown in the employment market going and in that area of the economy fears of a double-dip are more than just a hypothetical debate.


This was first published in October 2010

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