Scotland’s economy: IT demand helps boost jobs market

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Scottish labour market conditions improved sharply in August with both permanent staff placements and temp billings rising “markedly”, a new survey out today says.

Employer demand for staff remains strong, spearheaded by IT and computing, says the latest IHS Markit Report on Jobs in Scotland, produced for the Recruitment & Employment Confederation (REC).

Employer demand for staff remains strong, spearheaded by IT and computing. Picture: Michael Gillen

Employer demand for staff remains strong, spearheaded by IT and computing. Picture: Michael Gillen

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The report said pay pressures in Scotland had softened slightly in August “but remain elevated”. In the wider UK, it says employers are having to offer higher wages to secure skilled workers.

The UK research found that the number of candidates for jobs is falling, while demand has risen at its fastest in more than two years.

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The report for north of the Border noted: “Recruitment consultancies reported sharp increases in permanent placements and staff demand, while pay pressures remained marked.”

It added: “The rate of expansion accelerated slightly since July, but remained below that recorded for the UK as a whole.”

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REC chief executive Kevin Green said: “As this month’s report clearly shows, employers are increasingly turning to recruitment agencies as it becomes harder to find the people to fill the jobs available.

“Businesses are seeking more professional and managerial capability, so we’re seeing high demand for roles like financial directors, analysts, and compliance and HR professionals.

“Meanwhile, there is a significant shortage of people to fill blue collar roles such as drivers, electricians, and construction workers, and this is being exacerbated by a fall in net migration from the EU.”

BCC cuts economic growth forecasts

The British Chambers of Commerce (BCC) has become slightly more pessimistic about the UK’s economic prospects in the medium term.

Saying that the fall in sterling’s value since the Brexit vote has harmed the UK’s performance, the BCC has marginally upgraded its growth forecast for 2017 to 1.6 per cent from 1.5 per cent.

But it has cut its growth forecast for 2018 from 1.3 per cent to 1.2 per cent, and from 1.5 per cent to 1.4 per cent in 2019.

Dr Adam Marshall, the BCC’s director-general, said that “the UK economy as a whole is treading water, and there is no sign on the horizon of a return to healthier levels of growth”.

• READ MORE: Weak growth to continue as Brexit weighs on economy

He added: “Our forecast suggests that the hoped-for rebalancing of the UK economy towards investment and export is unlikely to materialise in the medium term.”

Suren Thiru, head of economics at the BCC, said it was “increasingly clear that the post-EU referendum slide in the value of sterling has done more harm than good”.

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