Sharp fall in jobhunters found work by agencies - study


The number of jobseekers placed in work by employment agencies has fallen at the sharpest rate for seven years, a new study reveals.

There has been a "marked" drop in permanent appointments amid heightened uncertainty as a result of the EU referendum, said the Recruitment and Employment Confederation (REC).

The rate of contraction was the sharpest since May 2009, with Brexit-related uncertainty particularly strong in London.

Some agencies said firms were seeking more temporary or short-term staff because of the current economic climate.

REC chief executive Kevin Green said: "The UK jobs market suffered a dramatic freefall in July, with permanent hiring dropping to levels not seen since the recession of 2009.

"Demand for staff remains strong with vacancies continuing to rise, but the sharp fall in placements suggests that businesses are highly cautious about committing to new hires. Economic turbulence following the vote to leave the EU is undoubtedly the root cause.

"The record-high employment rate and ongoing skill shortages have made it difficult for employers to find suitable candidates for the roles available in the past, and this remains the case. We're now seeing the added problem of individuals deciding to stay put rather than change jobs in the current environment.

"While there are worrying signs, it's important we don't jump to conclusions from one month's data. The truth is we don't know what long-term consequences the referendum result will have on UK jobs. With the political situation becoming more stable and the Bank of England making sensible decisions, we may well see confidence return to the jobs market more quickly than anticipated."

Permanent placements also fell markedly in the Midlands, South and Scotland.

There was a fall in demand for construction workers in July, while nurses and medical staff remained the most sought-after employees.

A Government spokesman said: "Recent figures on jobs and growth have shown that as we enter a period of adjustment following the referendum, we do so from a position of economic strength.

"Employment is at a record high fuelled by people in permanent jobs, there are almost a million new businesses in our country since 2010 and a near record three-quarters of a million vacancies in the UK economy.

"People can be assured that the Government is prepared to take the necessary steps to support the economy and promote confidence, as we make a success of Brexit and build a country that works for everybody."