Demand for IT jobs still falling - but not as fast

Decline is slowing - but too early to say that the recruitment market is about to recover, says research

Fewer IT jobs are being advertised

The decline in the number of IT job vacancies in the UK has slowed to its lowest rate in six months, according to research.

The latest monthly Report on Jobs from the Recruitment and Employment Confederation (REC) and KPMG shows that the index of demand for IT staff in June was down 13 per cent from May – but that decline has now shrunk every month since the start of the year.

Across the whole UK recruitment market, the number of vacancies continues to fall, although IT is reflecting the wider trend with the declines slowing. Only the nursing, medical and healthcare sector showed an increase in demand – for the 13th month running.

Permanent IT vacancies have an index ranking of 43.3 in the study – a rank of 50 means no change, greater than 50 is an increase in demand, and below that figure represents a fall. Twelve months before the June survey, IT's ranking was 50.3.

Despite its decline, the IT sector continues to hold up better than most – it has been falling more slowly than any other segment outside healthcare for several months.

The REC/KPMG survey also showed that “staff availability” – the number of people looking for jobs – showed a “further substantial rise” in June.

The most in-demand IT skills quoted by recruitment consultants were for enterprise software expertise.

REC chief executive Kevin Green said there may be signs of life in the UK jobs market, but there are still dangers ahead.

“While the public sector has continued to recruit, it is now critical that demand returns to the private sector to negate the potential public expenditure constraints that we are likely to see over the next few years that could in turn hinder a full recovery of the UK jobs market,” he said.

“An increasing number of recruiters are reporting a rise in the demand for temporary and contract staff. Flexible working options will provide a crucial way back into work for a number of jobseekers, which is why we must ensure that the new regulations covering agency work do not limit these opportunities.”

Mike Stevens, partner and head of business services at KPMG, said it is too early to talk about a recovery in the UK jobs market.

“One reason why we see continued improvements may be that more UK employers are asking staff to work reduced hours for lower pay in return for less aggressive redundancy plans,” he said.

“This approach is definitely one of the hallmarks of the current recession. Many employers understand they need to engage properly with employees to address the difficult economic situation. They are keen to retain access to the knowledge and skills of their staff and employees can feel slightly less insecure.”