Firms ‘now more confident in recovery’ as hiring spree continues

Scottish firms “are now more confident in the recovery” as the number of permanent positions in the country sees a near-record increase.

There was a further rise in hiring activity at the start of the year, according to the Royal Bank of Scotland’s jobs report, with recruiters north of the border recording their 13th monthly rise in permanent placements during January.

Sebastian Burnside, chief economist at the bank, said the near-record pace in permanent job appointments was “outstripping the UK-wide average by a notable margin”.

“Overall the data suggest that the labour market remains on a strong footing as we head further into 2022, and any shift from short-term to permanent positions suggests firms are now more confident in the recovery and are pressing on with hiring plans to meet rising customer demand,” he said.

The Edinburgh-based bank said businesses attributed the upturn in permanent placements to increased activity at Scottish companies and the rate of expansion was the second-fastest on record, behind only August 2021.

Mr Burnside said: “There was a different story for temporary staff, however, as the rate of increase in temp billings slowed and was only mild, with respondents noting that a number of candidates and firms were favouring permanent roles as confidence around the economic outlook strengthened.”

Across the UK as a whole, temp billings rose at the quickest rate for four months, with the upturn markedly outpacing that in Scotland.

In January, the bank data showed, there was a further rise in average salaries given to new joiners across Scotland for the 14th month running with pay inflation close to November’s peak.

The RBS said said strong demand for permanent staff, alongside difficulties finding suitable people to fill the positions, drove the upturn.

Meanwhile, while the average hourly pay rates for short-term staff rose, temp wages rose at the slowest rate since July.