Meanwhile, demand for both permanent and temporary staff declined, with the fall in permanent vacancies the first since September 2010, while the contraction in temp demand was the quickest since June 2009. At the same time, candidate availability continued to deteriorate.

Recruitment consultancies in Scotland signalled a rapid decline in permanent staff appointments during March. The rate of contraction was the most marked since the depths of the global financial crisis in April 2009. According to panellists, firms had stopped hiring amid the outbreak of the COVID-19 pandemic.

Temporary staff billings across Scotland also fell, with the reduction the steepest recorded since data collection began in January 2003. As was the case with permanent placements, respondents linked the reduction to the coronavirus outbreak.

Demand for permanent staff in Scotland fell for the first time since September 2010 during March. That said, the rate of decline was only mild overall, and softer than that recorded at the UK level.

Temporary staff vacancies also fell during March, thereby ending a record 124-month sequence of growth. Moreover, the reduction was the quickest since June 2009 and solid overall. The decline in Scotland was part of a wider UK trend, although the fall in Scotland outstripped that seen at the UK level.

Starting salaries awarded to permanent joiners in Scotland continued to increase during March, as has been the case in each month for over seven years. That said, the rate of salary inflation was the softest for three months and only mild.

Concurrently, average hourly pay rates for temporary staff rose further, with the uptick the quickest since last October and solid. The rate of wage inflation remained softer than the long-run series average, however.

March data highlighted a further reduction in the availability of permanent candidates. The rate of decline quickened from February and remained much sharper than the UK-wide trend.

Sebastian Burnside

Similarly, temp staff supply declined during March, as has been the case in each month for over three years. The reduction was the softest since November 2017, however.

Sebastian Burnside, chief economist at Royal Bank of Scotland, said: “The COVID-19 pandemic weighed heavily on the Scottish labour market in March. Permanent staff placements fell at the steepest rate since the global financial crisis over a decade ago, while temp billings declined at the sharpest rate since data collection began over 17 years ago.

“At the same time, demand for both permanent and short-term staff declined, with panellists reporting that firms had stopped hiring amid the coronavirus pandemic. The reduction in permanent vacancies was the first since September 2010, while the fall in temp staff demand was the fastest since mid-2009.

“Overall, latest data highlighted the substantial impact of emergency measures and shutdowns that have taken place due to the COVID-19 outbreak and the vital importance of the government schemes put in place to safeguard livelihoods during this exceptional time.”

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