Demand for temporary staff has increased for UK businesses amid recession fears, trumping the employment for full time workers, according to a new survey from KPMG and the Recruitment and Employment Confederation (REC).
The survey revealed a rapid downturn of permanent placing from 49.3 points in March to 44.2 points in April – the fastest decline since the beginning of lockdown in 2021 – whereas the temporary index climbed from 52.5 points to 53.3 over the same time period.
Britain’s economy has outperformed experts’ forecasts, avoiding a technical recession, as leaders such as the EY ITEM Club now expect growth to 0.2%, up from the -0.7% contraction projected in January’s Winter Forecast. However, it remains jittery and has knocked business confidence.
The decline’s links to business concerns have led to many adapting their strategies in a bid to avoid long-term contracts and directing them to take on temporary staff who can help them grow but be quickly let go if necessary.
Demand, as well as pay, is also rapidly rising as businesses try to outbid competitors for talent, with the permanent staff salary index jumping to 61.4 points and temporary staff pay hitting 57.9.
Sridhar Iyengar, MD of Zoho Europe, said: “Businesses turning to temporary staff is an indication of the struggles some are facing in these testing economic conditions. However, this is a short-term solution and companies need to ensure they are agile and resilient enough to cope with any disruptive market factors.”
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