Staff shortages push up salaries

Donald MacRae says recovery in the Scottish economy looks set to continue
Donald MacRae says recovery in the Scottish economy looks set to continue
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RISING demand for staff, combined with a record drop in the number of people searching for permanent employment, saw wages in Scotland grow last month at the fastest pace for more than 11 years.

The Bank of Scotland’s latest labour market barometer, published today, shows that “growing pressure” in the jobs market contributed to the acceleration in permanent salaries, while there was also a “marked” decline in the number of people seeking temporary jobs.

Donald MacRae, the bank’s chief economist, said the findings of its research suggest that the recovery in the Scottish economy “looks set to continue”.

He added: “June’s barometer reached a record high in the 11-and-a-half years of the survey.

“The number of people appointed to jobs increased while vacancies grew at a robust rate. The number of candidates available for both permanent and temporary jobs fell, accompanied by a record rise in starting salaries.”

The rise in demand for permanent employees was highest in the accounting and financial sector, with temporary job vacancies growing most strongly in nursing, medical and care.

Edinburgh led the growth in permanent placements for a second month running, while Glasgow experienced the sharpest increase in permanent salaries.

Today’s labour market report came as research by accountant Campbell Dallas found the “resurgence” in the oil and gas industry has seen the amount of income tax paid by workers in Aberdeen soar by more than a fifth in five years.

The firm said each taxpayer in the Granite City paid an average of £6,110 to the taxman in 2011-12, up from £5,060 in 2006-07. That compares with a 0.8 per cent decline to £3,760 in Fife over the same period.

Campbell Dallas chairman Ian Williams said he expected the number of people moving to the city and Aberdeenshire to continue rising, “given the influx of new business in the region”, which will need to invest in its infrastructure to cope with the rising population.

Williams said: “Many local small and medium-sized businesses are benefitting from the resurgence of the North Sea oil and gas industry. People new to the area have expectations of what their ideal home location should have in place, be it schools or leisure facilities, property or road networks.”

The Scottish Government last month named Connect Roads, a consortium comprising Balfour Beatty, Carillion and Galliford Try, as the preferred bidder for the £745 million Aberdeen bypass, which is due for completion by spring 2018.

Commenting on today’s jobs research, Finance Secretary John Swinney said the figures showed the “sustained improvement in Scottish labour market conditions”.

Mr Swinney added: “This report follows on from last week’s positive GDP and labour market figures, which showed that Scotland’s economy is now back above pre-recession levels and employment levels are at their highest since records began, with 2,587,000 people now employed in Scotland.

“While the survey highlights salary inflation, we have to remember that this is against a backdrop of real wages falling continuously over the last six years and average pay in Scotland falling back to 2005 levels.

“It is essential that everyone is able to benefit from our new economic growth.”