UK Recruiters Report Record Fall in Jobs
British recruiters reported a record fall in job appointments and the first drop in wages for five years in October, industry group the Recruitment and Employment Confederation said in a survey published with accountants KPMG on Wednesday.
Demand for staff shrank sharply and both permanent and temporary staff appointments were at their weakest level since the start of the survey in October 1997.
The salaries index slipped into contraction, dropping to 45.7 from 50.0 for permanent employees, permanent placements plunged to 33.2 from September's 41.2, and temporary placements slid to 38.6 from September's 45.3.
"These are the worst figures we have seen since the report began ... with both vacancies and the number of job placements falling at an increasing rate," REC chief executive Kevin Green said.
Mike Stevens, a partner at KPMG, said the survey showed the credit crunch was likely to cause unemployment to rise further.
"The terrible news from the equity markets and the broader economic front have led to a steep fall in the demand for permanent and temporary jobs across most sectors of the economy and the worst is probably yet to come," he said.
British unemployment rose to 5.7 percent of the labour force in August. Falling wages may ease the Bank of England's concerns that inflation could be slow to fall from the multi-year high of 5.2 percent set in September if it continues to cut interest rates aggressively.
The BoE cut interest rates by half a percentage point to 4.5 percent last month in joint action with other central banks, and most economists polled by Reuters expect the BoE will reduce rates by at least the same again when it meets on Thursday.