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A new report shows that the demand for temporary workers is currently being driven by record Covid-19 infection levels.

The latest REC / KPMG Report on Jobs highlighted softer rises in hiring activity during last month, as a shortage of candidates restricted growth of both permanent and temp billings.

The data also shows that average wages for temp workers rose at a rapid pace – the quickest reported in three months.

Neil Carberry, Chief Executive of the REC, said, “We can clearly see that labour and skills shortages are driving inflation in these latest figures. Record COVID infection levels are also pushing up demand for temporary workers, particularly in blue collar and hospitality sectors, underpinning the ability of temps to seek higher rates.

“However, the overall number of placements being made is starting to stabilise. This is no surprise after a period of historically high growth, and in the face of more economic uncertainty. Even so, the jobs market is very tight. Businesses will need to broaden their searches and be creative in making their offer to candidates more attractive, in consultation with recruitment experts. But government can help by incentivising investment in skills and people during the inflation crisis.”

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Claire Warnes, Head of Education, Skills and Productivity at KPMG UK, added, “There’s no end in sight to the deep-seated workforce challenges facing the UK economy. Once again this month, job vacancies are increasing while there are simply not enough candidates in all sectors to fill them.

“With fewer EU workers, the ongoing effects of the pandemic, the economic impacts of the war in Ukraine and cost of living pressures, many employers will continue to struggle to hire the talent and access the skills they need. With unemployment staying low, there are many great opportunities for job-seekers to join or rejoin the workforce in all sectors.”

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