Scots salaries soar amid ongoing candidate shortages

Salaries paid to newly-placed permanent staff in Scotland continued to increase at a “marked pace” in October, according to the latest Royal Bank of Scotland Report on Jobs survey.

“The rate of permanent salary inflation remained historically elevated and outpaced the UK-wide average for the fifth successive month,” said the report.

“Survey respondents linked higher salaries to ongoing candidate shortages and efforts to attract suitably-skilled staff.

“October data highlighted a sharp rise in contract pay across Scotland, thereby extending the current run of wage inflation to nearly three years.

“Moreover, the rate of increase quickened from September and was the strongest since May.

“The rate of temp wage growth across Scotland outstripped that recorded for the UK as a whole.”

The survey said recruitment activity continued to weaken across Scotland at the start of the final quarter of 2023.

“Sustained downturns were recorded for both permanent staff placements and temp billings in October, although rates of decline were the softest seen in three months,” said the report.

“The reduction in hiring activity was accompanied by a steep deterioration in vacancies.

“Turning to pay, starting salaries and temp wages rose for the thirty-fifth month running in October.

“According to panellists, clients raised their pay offers due to efforts to secure scarce and suitably-skilled candidates …

“Permanent candidate availability contracted rapidly across Scotland during October, thereby extending the current sequence of deterioration that began in February 2021.

“The rate of reduction quickened from September and remained faster than the series average. Recruiters commonly noted reluctance among potential candidates to move roles given the uncertain economic climate.

“In contrast, a rapid and accelerated expansion in permanent staff supply was recorded across the UK as a whole …”