This month’s report looks at the data from halfway through Q1. Data from February’s numbers reveal that there continues to be an increase in the number of workers joining the UK workforce and leaving the economically inactive population.

Recently revealed ONS data declares that more than half (62%) of the people joining the workforce between July and December last year came from economic inactivity. This is great news for both the UK economy and the jobs market.

New trends.

There are a couple of new recruitment trends that have emerged from data released in February.

Zero hours contracts.

February data from the REC highlights that there has also been an increase in listed job vacancies. Early in the month, new job postings reached a 14-month peak.  In the week commencing the 6th of February, 256,855 new jobs were advertised.

Many of these vacancies were within sectors where zero-hours contracts are common.  Data from the ONS supports this. Throughout Q4 last year, zero-hours contracts rose to a record high of 1.13 million; a YoY increase of 9.6%. This rate of growth is indicative of how crucial flexible workers are, and have been, to the UK labour market.

In the past, zero-hours contracts have come under scrutiny.  Many flexible workers have reported that they have been exploited by these types of contracts. Despite this, they are used productively across different industries. They aren’t inherently exploitative and are readily used within the hospitality and retail sectors to some effect.

However, if these types of contracts are on the rise, it’s clear that more regulation and clarity need to be offered to employees and employers alike to help avoid their misuse.


Another significant trend gleaned from February’s data is that of a lift in redundancies.  The ONS has shown that the redundancy rate has increased on the quarter and is now close to pre-pandemic levels. Between November 2022 and January 2023, the number of people reporting redundancy increased by 0.2 per thousand employees compared to the previous period, to 3.3 per thousand employees.

This rise in redundancies has obvious knock-on effects on the recruitment sector.  Candidate availability has been a long-standing and widely reputed problem. It has been challenging to fill roles amid candidate shortages.

It will be interesting to see how a lift in redundancies affects candidate availability over the coming months.

an african american candidate is being interviewed by two young professional women

The recruitment landscape – February 2023.

Here are February’s headlines from inside the recruitment sector.


As we have already mentioned, there was an upturn once again in the number of reported vacancies in February. The number of permanent roles grew at a sharp pace and experienced its quickest expansion in 4 months.

In contrast, the demand for contract or temporary staff was reported to have risen at the softest rate for 2 years. Despite this, its rate of growth was still significant overall.

Within both the public and private sectors, the demand for staff expanded. The quickest rate of demand was for contract staff within the public sector, closely followed by permanent staff within the private sector.  Temporary roles within the private sector saw the softest levels of demand.

The ONS says.

The total number of vacancies over the last 3 months fell by 76,000 to 1,134,000 overall. While this number is the lowest we have seen since September 2021, it remains significant. This figure is nearly +38% higher than pre-pandemic numbers.

Vacancies by sector.

The demand for permanent staff rose across all 10 job categories in February and includes the IT and technology sector.  Regarding temporary vacancies, the demand for contract IT and computing staff did experience YoY growth. However, its increase was the shortest of all reported sectors.

Placements and billings.

Permanent placements.

Permanent appointments fell for the 5th consecutive month, and at a slightly quicker pace than we saw in January.

Our colleagues cited caution at the hands of the uncertain economic forecast and client hesitancy over hiring decisions to be significant contributory factors. Of course, the long-running lack of suitable candidates was also a factor that slowed placement activity across February.

3 of the 4 monitored geographical regions recorded lower numbers of permanent placements. Only the north of England bucked the trend and reported a modest upturn.

Temporary billings.

Billings for temporary workers continued its run of growth throughout February, although this was more modest than we have seen previously.

This run of expansion has continued for 31 successive months now but did soften from the rate of growth we experienced at the start of the year.

The north of England recorded the steepest increase in temporary billings while the Midlands was the only area to record a fall.

Staff availability.

Overall, the UK’s decline in labour supply continued in February. However, the pace of the deterioration was softer and was the slowest we have seen for almost 2 years.

Both permanent and contract candidate numbers decline but at slower rates than throughout January.

Within the permanent sector, February’s reduction extended the downward trend to hit the 25-month mark.  Again, the rate of contraction was slow and the softest we have seen since last March.  Recruiters reported anecdotal evidence that in such market uncertainty and amid the cost-of-living crisis workers have been reluctant to seek new roles.

Permanent staff availability was reported to have risen in London but remained low elsewhere.

Contract Staff.

Since March 2021, the number of temporary staff have declined.  A shortage of foreign workers and candidate preference for permanent positions have been held accountable for the deterioration in contract candidate availability.

Anecdotally though, recruiters have reported that the high redundancy numbers we mentioned earlier have muted the shortages somewhat and pushed up active candidate numbers.

Skills in demand.

Within our sector, the demand for skills remains constant.  The demand for data professionals such as Data Engineers and Data Scientists remains high. Developers and Software engineers are also in demand as are automation testers and Cyber Security professionals.

At Ignite Digital.

Our clients’ moves to digital and cloud-based infrastructure have informed many of their recent hiring choices, as has the migration to a more remote and hybrid working arrangement.

Insight and change Professionals are also high on the hiring agenda, as our clients look toward the future and their ongoing business development. We have received requirements for migration specialists to help move on internal works as well as many leading IT support roles to help staff navigate these new systems.

Pay and reward.

To attract and secure candidates within the cost-of-living crisis, permanent starting salaries remained above average in February.  This rate of inflation increased slightly on the month and remained sharp overall.

There was also a further increase in the average daily and hourly rate within the temporary sector.  However, the rate of growth softened from January and was the second softest we have seen in nearly 2 years.

The south of England showed the steepest increase in temporary rates, while the slowest was in London.

The ONS and pay.

The ONS reports that employee earnings rose +5.9% over the final quarter of 2022.  Though sharp, this was the softest rate of pay growth since April-July 2022.

However, more recent data from this year indicated growth in average pay, including bonuses, of 5.7% and a growth in regular pay of 6.5%.

However, while pay is still rising, prices are too.  Regular pay may have increased by 6.5%, but prices rose by 10.1%. This is reflective of the significant challenges and obvious disparity faced here in the UK.

Public sector strikes amid the cost-of-living crisis are becoming commonplace. Looking into the ONS data, it’s easy to see why public sector workers are making a stand. Despite pay increases across both markets, the gap between public (up 4.8%) and private (up 7%) sector pay has widened.

For those of us with public sector contracts, it will make recruitment and retention within the public sector more challenging as time goes on.

February – the highlights.

Here are the headlines.

  • February saw a continuing fall in permanent placements, and we saw a modest expansion in temporary billings.
  • Overall vacancy growth improved to a 4-month high. Underlying data signalled that demand for permanent workers expanded at a quicker pace, while temp vacancy growth softened slightly.
  • We saw that the current downturn in candidate availability continued to ease midway through the first quarter. Staff supply fell at a mild rate that was the slowest we’ve experienced for nearly two years. This was underpinned by softer falls in both permanent and temp candidate numbers.
  • Rates of starting pay continue to rise. Permanent starters’ salaries continued to rise at a quicker pace than that seen for temp pay. However, in both instances, the rate of growth was almost the softest we’ve seen for nearly two years.


About the author: I manage the recruitment for a range of digital roles for my clients on both a retained and contingency basis. I specialise in senior and confidential appointments, always giving a first class representation of a client’s employer brand.

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