Scottish job placements 'slump after Brexit vote' Published duration 4 August 2016 Related Topics Brexit

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Recruitment consultancies in Scotland have reported the steepest drop in permanent placements since 2009, following the Brexit vote.

A survey by the Recruitment and Employment Confederation (REC) found 37% of participants saw a drop in permanent appointments last month.

The fall contrasted with a modest rise in temporary placements.

REC cited "economic turbulence" following June's vote to leave the European Union as the "root cause".

The survey of 100 consultancies, conducted on behalf of REC by Markit, also found the slowest increase in permanent salaries for almost three years.

There was a similar pattern in hourly rates of pay for temporary staff, which saw growth slow to near stagnation at the start of the third quarter after hitting a survey-record high in April.

Permanent candidate availability continued to deteriorate across Scotland during July.

However, the availability of candidates for temporary vacancies increased for the second month running and to the greatest extent since February 2012.

'Dramatic freefall'

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."

A UK 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."