Scots labour market shows some welcome signs of stabilising

Releasing its latest jobs report today, Bank of Scotland found the fastest increase in job placements was in Aberdeen, where it reached a five-month high.

But the growing number of people who are chasing work is continuing to restrict pay rates across the country.

The report's main labour market barometer - a composite indicator designed to provide a single figure snapshot of labour market conditions - registered 48.4 in October, up from 46.8 a month earlier.

Although below the 50 no-change mark, largely due to strongly rising candidate availability, the barometer was at its highest level since June.

Donald MacRae, chief economist at Bank of Scotland, said: "Demand for both permanent and temporary employees rose, with the number of people placed into temporary positions increasing at a five-month high.

"While not as strong, the mild growth in permanent job placements was the first increase in four months."

Conditions in Scotland's labour market remain challenging, the report noted, but the gap between Scotland and the UK narrowed last month.

"The number of candidates available for jobs increased at a strong rate, putting pressure on salaries and wages," MacRae added. "This report shows the slowdown in the Scottish economy has been arrested rather than reversed this month."

Average salaries for successful permanent candidates fell marginally in October, extending the current period of decrease to five months.

The fastest increase in permanent and temporary placements was in Aberdeen and Edinburgh respectively. Meanwhile, Dundee posted the largest falls in both sectors.

Five out of the eight monitored employment sectors saw higher demand for permanent workers in October. IT and computing employees were the most sought-after for the second month running.

The report, compiled by Markit, is based on a poll of more than 100 recruitment and employment consultants.

l British firms are facing a shortage of temporary workers during the busy Christmas period despite high levels of unemployment, according to report today.

The logistics and care sectors will be particularly badly hit, while retail and construction companies also expect problems recruiting temporary staff, agency firm de Poel claimed.

Matthew Sanders, chief executive of de Poel, said: "Temporary agency workers are an integral part of the economy as we gear up for some of the busiest months of the year.

"It is concerning to see that, despite the rising levels of unemployment, our industry is increasingly concerned about suitably trained staff."