UK starting salaries jump but demand for staff cools
LONDON (Reuters) – People beginning new jobs in Britain enjoyed the biggest jump in starting pay in over three years in September, a survey showed on Friday, but slowing demand for staff ahead of Brexit could make the boost to wage growth short-lived.
The Recruitment and Employment Confederation’s (REC) gauge of permanent job starting salaries rose to 64.5 from 62.4 in August to hit its highest level since April 2015.
While that may give the Bank of England confidence that overall wage growth in Britain will continue to pick up as it has forecast, REC’s index of staff demand fell in September to its weakest level since late 2016.
This measure has led starting salaries by a couple of months on average over the survey’s 21-year history.
The latest official data on earnings showed British workers’ pay, excluding bonuses, accelerated in the three months to July to a rate that has not been surpassed in three years as firms found it harder to hire staff.
Recruiters cited Brexit as the biggest reason for uncertainty in the supply of labour, REC said on Friday, pointing to a drop in the availability of candidates — particularly in areas such as medicine.
This week Prime Minister Theresa May said Britain’s post-Brexit immigration system will prioritise high-skilled workers and treat European Union citizens the same as those from elsewhere.
Business groups have expressed concern that companies will be left without easy access to the workers they need.
“An effective approach to post-Brexit immigration must acknowledge that there is unmet need for roles of all sorts – not just those filled by the very highest earners,” REC chief executive Neil Carberry said.
“Keeping deliveries going, patients being treated and goods on the shelves means an open approach to workers from elsewhere.”