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Northern Powerhouse fuels contractor recruitment boom

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The Northern Powerhouse is alive and well, if a survey of UK recruiters is anything to go by.

Recruitment agencies based in the north of England reported a sharper increase in fees or ‘billings’ from contractor and temp placements than any other region in July.

The surge in contractor placements by northern agencies comes as the so-called Northern Powerhouse – a government initiative first championed by former chancellor George Osborne – comes under pressure.

The central aim of the Northern Powerhouse concept is to boost the north’s economic fortunes, for example by cutting journey times between key cities in the region such as Manchester and Leeds.

However, concerns have been growing since Mr Osborne was sacked as chancellor last year that the concept would amount to little more than rhetoric.

Earlier this month Labour claimed that government plans to scale back electrification of a key rail route would kill off the Northern Powerhouse before the project had even got off the ground.

The latest data from recruitment agencies suggests that the northern economy is doing just fine regardless, at least as far as contractors (and the recruiters who find them work) are concerned.

Not just about the Northern Powerhouse

Whilst agencies in northern England led the way, the boom in contract recruitment isn’t confined to the north. Far from it.

Nationally, agency contract and temp billings increased at the fastest rate for nearly two and a half years. All regions monitored by Markit and the Recruitment & Employment Confederation (REC) saw sharp increases.

At the same time, the availability of temporary candidates declined at the quickest pace for 18 months. This exerted upward pressure on pay, with contractors’ assignment rates continuing to increase sharply.

The only black spot for the contractor recruitment market was that growth in demand softened in the public sector.

A consequence, perhaps, of April’s public sector IR35 reforms.

Commenting on the findings contained in July’s Report on Jobs, REC chief executive Kevin Green said:

The jobs market continues to confound expectations with both permanent and temporary placements growing at the fastest rate for over two years. It’s clear that employers are having to work even harder to fill jobs as vacancies rise and candidate availability shrinks.

UK employment remains at an all-time high and looks set to keep improving. The parts of the economy most reliant on European workers are under even more pressure as many EU workers return home.

Employers are not just struggling to hire the brightest and the best but also people to fill roles such as chefs, drivers and warehouse workers.

IT contractors defy usual summer slowdown

Focusing on the IT sector, news site Contractor UK reported that the usual summer slowdown in demand for IT contractors has failed to materialise this time around.

July’s demand index score of 61.1 is only slightly lower than the year-to-date peak of 61.9, which was recorded in May.

Cyber security, DevOps (development & operations) and Java all feature in the list of the most in-demand IT skills.

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