UK Permanent Hiring Slows To 18-Month Low, Recruiters Say

(Reuters) - British firms hired permanent employees at the slowest rate in 18 months in November, although starting salaries rose faster due to staff shortages in many sectors, a survey showed on Friday.

The monthly survey from the Recruitment and Employment Confederation tallies with official data which has shown Britain's rapid pace of job creation slowing, after a sharp fall in the unemployment rate to just 6 percent in the three months to September.

"(There's) not much sign of a happy Christmas in the job market," said Bernard Brown, a partner at accountancy firm KPMG, which sponsors the survey.

Brown said the slowdown in hiring could start a trend, due to political uncertainty ahead of May's national election and the risks related to a referendum on Britain leaving the European Union.

But news that salaries are starting to rise is likely to be welcomed by the government and the Bank of England, which has been forecasting that wages will pick up as hiring slows and productivity growth starts to improve.

Higher wages are also essential to drive the forecast recovery in weak tax receipts included in Chancellor George Osborne's budget update on Wednesday.

"It's a sign of continuing business confidence that employers are expanding their permanent workforces and are prepared to make more generous offers to new recruits," said REC Chief Executive Kevin Green, who viewed the data more positively than Brown.

There was growth both in salaries for people starting new permanent jobs and in hourly rates for temporary workers, driven partly by staff shortages in many sectors. Salaries for new permanent staff rose faster than their historic rate, the REC said, after climbing at the slowest rate in eight months in October.

Green said skills shortages were the biggest threat for 2015, especially in areas such as IT, engineering and medicine as well as for truck drivers and forklift operators.

"Retailers (could) struggle to meet the Christmas demand generated by ... eager shoppers," Green said.