Jobs market expanding at slowest pace for almost two years

Growth in Scotland’s jobs market has weakened, with the slowest rise in permanent appointments for 22 months, according to a report published today.

Donald MacRae says the jobs market shows signs of cooling

The Bank of Scotland also said the number of people placed in temporary roles fell last month as the supply of available candidates deteriorated.

Despite the slowdown revealed by its report on jobs, the bank said the labour market continues to grow. Its “barometer” reading of 60 was the lowest since September 2013 and down from 63.2 in December, but remains well above the 50 level that separates growth from contraction.

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Chief economist Donald MacRae said: “Scotland’s jobs market continued to improve in January but showed signs of cooling.

“The number of people appointed to permanent jobs rose but temporary appointments fell. Vacancies continued to increase across most sectors accompanied by a rise in starting salaries although lower than December’s near-record high. This report on jobs suggests the Scottish economy continues to grow at the start of 2015 but at a slower rate than the end of last year.”

The study came as the Chartered Institute of Personnel & Development (CIPD) revealed a “tale of two workforces”, with almost half of workers enjoying pay rises of 2 per cent or more while a similar proportion faces wage freezes or cuts.

According to CIPD research, public sector workers were most likely to have seen their pay frozen last year and can expect a rise of 1 per cent in the year ahead, compared with a median basic pay award of 2 per cent.

Labour market analyst Gerwyn Davies said: “It comes down to what businesses can afford, and productivity lies at the heart of an organisation’s ability to increase real wages above the rate of inflation.”