The ongoing shortage of suitable job candidates in Scotland contributed to permanent staff appointments declining for the first time in four months in February, according to the latest Royal Bank of Scotland Report on Jobs.

“February data signalled a further increase in demand for permanent staff across Scotland …” said the report.

“Pay pressures across Scotland strengthened during February.

“Salaries awarded to permanent new starters increased at the fastest rate for four months and sharply overall …

“As has been the case in each month since March 2012, the availability of permanent candidates fell during February.

“Despite easing to the least marked in nearly three years, the rate of decline remained sharp overall.”

Royal Bank of Scotland chief economist Sebastian Burnside said: “Permanent placements in Scotland fell for the first time since last October during February, with recruiters often blaming this on candidate shortages but also muted demand for staff.

“Moreover, this contrasted with the more upbeat picture at the UK level, where permanent appointments rose at the sharpest pace since December 2018.

“Temp billings in Scotland meanwhile fell at the steepest rate for over a decade in February, which was partly linked to the upcoming implementation of IR35 legislation.

“Meanwhile, growth of demand for staff eased, which alongside falling placements, indicates a softening of the Scottish labour market midway through the first quarter of the year.

“Permanent vacancy growth was among the slowest since early-2013 in February, whilst demand for temp staff expanded at the softest pace for over eight years.”