The South West鈥檚 labour market is in a sorry state with few jobs available, redundancies being made and salaries falling as the coronavirus lockdown wreaks havoc, a new report says.
The KPMG and REC 海角视频 Report on Jobs: South of England, which covers the South West, shows the region鈥檚 labour market remained under pressure in May 2020, as the Covid-19 pandemic led to a further marked fall in recruitment activity.
The survey showed steep reductions in permanent placements and temporary billings, despite rates of decline easing from April.
The pandemic also weighed heavily on demand for staff, with vacancies continuing to fall at a substantial pace.
Consequently, starting pay fell at steeper rates for both permanent and temporary staff. The availability of workers meanwhile rose sharply amid reports of redundancies and businesses placing workers on furlough.
Ian Brokenshire, Senior Partner for KPMG in Plymouth, said: 鈥淭he latest figures make uncomfortable reading, and it鈥檚 a worrying time for both employees and businesses in the region.
鈥淚t comes as no surprise that we鈥檙e seeing the sharpest falls in temp and permanent placements for decades, coupled with a drop in salaries.
鈥淭hat said, it鈥檚 interesting to see that weekly salaries in the South West are the third highest in the country, behind London, and Yorkshire and The Humber, according to the latest ONS data.
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鈥淚 have faith that the resilience of the region鈥檚 businesses will be evidenced in improving numbers in the coming months. Businesses now need to plan carefully to navigate the legal and logistical challenges as they exit lockdown.鈥
South West recruitment consultancies surveyed mentioned that the Covid-19 pandemic and subsequent lockdown led to hiring freezes among businesses.
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Business Live's South West Business Reporter is William Telford. William has more than a decade's experience reporting on the business scene in Plymouth and the South West. He is based in Plymouth but covers the entire region.
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According to recruiters, company closures and economic uncertainty weighed on short-term billings and permanent vacancies also continued to decline.
There were also more people looking for a job, mainly due to redundancies and people placed on furlough. Recruiters often mentioned that temporary staff supply also rose as companies shed staff or placed workers on furlough.
Starting salaries for permanent staff declined further in May and the rate of reduction was the most severe since data collection began in October 1997 and was substantial.
Anecdotal evidence indicated that the Covid-19 pandemic and weaker demand for staff had placed downward pressure on salaries.
Neil Carberry, chief executive of the REC, said: 鈥淕iven the impact of the lockdown in early May, it鈥檚 no surprise that these figures look bleak.
鈥淏ut in the two weeks since this data was collected, lockdown rules have been eased and the feedback we get from recruiters every day suggests that the slight improvements that we can see in the placements and vacancies data have continued.
鈥淚鈥檓 also hearing from business leaders all over the country that things are starting to look up. There is a long way to go, but it鈥檚 time to talk about how we recover from this crisis.
鈥淐ollaboration between Government, businesses and recruiters will be vital as we try to get the economy up and running again. The 海角视频鈥檚 staffing and recruitment companies are experts at helping people find work, and we are ready to support jobseekers in the months ahead.鈥
The KPMG and REC, 海角视频 Report on Jobs: South of England is compiled by IHS Markit from responses to questionnaires sent to around 150 recruitment and employment consultancies in the South of England.
