SCOTTISH companies took on staff last month at their fastest pace since the spring, according to figures published today, sparking hopes for an upturn in business confidence.
Bank of Scotland’s labour market barometer – which is designed to give a single snapshot of the jobs market – climbed to 54.9 in November from 53.6 in October, reaching its highest level for seven months.
Scotland’s barometer reading outstripped that for the UK as a whole, echoing last week’s surprisingly good official employment figures. They showed the biggest fall in unemployment north of the Border for four years.
The bank said the number of staff placed in both permanent positions and temporary vacancies rose, with employers advertising more jobs during November.
Donald MacRae, BoS chief economist, said: “Conditions in the Scottish labour market improved in November with the barometer increasing to a seven-month high. Both the number of people appointed to jobs and the number of job vacancies rose in the month.
“Despite the economic slowdown, employers continue to hire, suggesting a rising trend in business confidence.”
Economists say boosting business confidence will be key to helping the UK avoid a triple-dip recession. Many companies have spare cash sitting on their balance sheets but are scared to invest because they are concerned about the effects the eurozone debt crisis and the looming “fiscal cliff” in the United States could have on their businesses.
The bank’s latest jobs report comes as the Scottish Parliament’s economy committee launches an inquiry today into “under-employment” – where people take part-time work but want full-time hours, or take permanent work that does not use all their skills.
Murdo Fraser, convener of the economy, energy and tourism committee, said: “Unemployment figures are routinely used as a temperature check on our labour market.
“Recent unemployment statistics show a drop in those unemployed, but evidence suggests these figures mask a more complicated picture, with under-employment on an upwards trend.
“Little is known about the impact of this trend on our economy and on those that are ‘under-employed’.”
Meanwhile, a report from south of the Border today also indicates that businesses in London may be gaining greater confidence.
Businesses in the UK’s capital expect to start “hiring as normal” again in the next six months, after a period of only taking on essential recruits in the first half of 2012, according to the latest joint CBI and KPMG London business survey.
The Olympic Games brought a noticeable boost to employment, which has now fallen back to more modest growth levels, the report said.
A separate survey, from recruitment firm Astbury Marsden, showed pay rises in the City have fallen this year, with average increases of just 2 per cent compared with 12 per cent last year.
Average basic pay for managing directors fell by almost a third from £237,000 to £167,000, though the average wage in the Square Mile increased from £83,000 last year to £84,438.
Mark Cameron, chief operating officer at Astbury Marsden, said: “The Financial Service Authority has gone to the lengths of briefing remuneration committees that overall pay should show a sharp decrease in 2012 – that is an unprecedented step to take.”