Brexit stunts growth in Scottish jobs market, finds RBS

Demand for both permanent workers and short-term staff slowed in October, found Royal Bank of Scotland. Picture: Ian Georgeson
Demand for both permanent workers and short-term staff slowed in October, found Royal Bank of Scotland. Picture: Ian Georgeson
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Scotland’s labour market declined last month, with permanent placements dropping at the quickest rate since January 2017, according to the Royal Bank of Scotland.

The lender found that the number of new starters in permanent positions in Scotland fell for a fourth consecutive month in October, while temporary billings growth continued, but softened to its slowest rate since 2016.

Recruiters require “a clearer outlook” as sustained political uncertainty arising from ongoing Brexit negotiations is hampering the labour market, RBS said.

Demand for both permanent workers and short-term staff slowed in October, with the former scaling back to is slowest rate for almost eight years.

Rising pay

However, pay pressures remained robust as candidate availability deteriorated further. Starting salaries awarded to permanent joiners in Scotland increased sharply, with the rate of salary inflation quickening from September’s recent low.

Wages for temporary workers also maintained upwards momentum in October, despite easing to the slowest rate since July.

Continuing a trend from previous months temporary staff billings continued to increase, albeit at the softest extent in four months. This trend was mirrored across the UK.

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Sebastian Burnside, chief economist at RBS, said: “October survey data highlighted further signs of weakness in the Scottish labour market, with permanent placements declining for the fourth successive month and at the quickest pace since January 2017.

“Meanwhile, temporary billings rose at the slowest pace in the current four-month sequence of expansion.

“Lingering Brexit-related uncertainty was a key factor cited by recruiters weighing on hiring in October. A clearer outlook is needed for the Scottish labour market to regain momentum.”