Boost in hiring activity across Scotland despite labour shortage

Recruiters across Scotland saw another boost in hiring activity in March amid reports of greater market confidence and increased business activity.

The Royal Bank of Scotland’s Report on Jobs survey found accelerated increases in both permanent placements and temp billings at firms north of the border last month.

Permanent positions increased at the second-fastest rate on record, and temp billings growth quickened to the sharpest for five months, the bank said, with expectations of recruitment activity to continue for the months ahead.

But Sebastian Burnside, chief economist at the Royal Bank of Scotland, warned: “Ongoing labour shortages do raise the question of how strong future increases in permanent placements and temp billings will be, as skill shortages limit firms’ ability to fill roles.

“Nevertheless, the competitive and tight labour market plays in favour of job seekers, with starting salary inflation hitting a fresh survey high in March.”

Last month was the 16th month running where there was a rise in permanent starting salaries in Scotland, and the fastest since the survey began in 2003.

The rate of salary inflation across the UK as a whole also hit a fresh series high in March but remained slower than that seen in Scotland.

And vacancies for permanent staff across Scotland expanded for the 14th successive month in March.

The rate of growth was the quickest since last October. Furthermore, the upturn in demand for permanent workers remained quicker than the UK-wide average.

By sector, engineering and construction recorded the steepest increase in permanent vacancies, followed closely by IT and computing.

And recruitment consultancies signalled an 18th straight monthly rise in temp vacancies across Scotland.

The rate of expansion was sharp, having accelerated to a three-month high, but was not as steep as that seen across the UK as a whole.