February data pointed to a further increase in permanent staff placements. The rate of expansion quickened slightly, reaching a three-month high. Temp billings meanwhile rose at the same pace as in January.

The level of available job vacancies continued to rise in February. The rate of growth was marked and the fastest in six months. Demand for permanent staff continued to show a stronger trend than that for temps.

The availability of staff for both permanent and temporary/contract roles continued to decline in February. Rates of decline eased in each case, however, to the slowest in at least two year

Starting salaries for successful permanent candidates rose at the fastest pace in three months during February. Temp pay growth eased, however, hitting a 33-month low.

Permanent placements rose across all four monitored English regions, with the Midlands posting the fastest increase. The slowest growth was reported in London.

The Midlands led a broad-based increase in short-term billings, with the slowest growth indicated in the South.

Private sector vacancies continued to register a stronger trend than public sector roles in February. The sharpest rise was seen for private sector permanent employees. By contrast, public sector permanent staff recorded only a marginal increase in demand.

Nursing/medical/care remained the most in-demand category for permanent staff during February, with engineering in second place. The slowest growth was indicated for workers in the hotel & catering sector.

Demand growth was broad-based for all nine types of temporary/contract staff in February. Nursing/medical/care was the most sought-after category, mirroring the trend seen for permanent staff.

REC chief executive, Kevin Green, said, “The UK labour market is at a critical juncture. Permanent hiring improved last month, demand for staff remains strong, and pay is going in the right direction – but serious threats are looming just around the corner.

“Next week the Chancellor will announce his plans for the coming financial year, at a time when recruiters across the country are reporting serious skills shortages alongside buoyant jobs growth. Now is not the time to put up additional hurdles that could throw the jobs-rich recovery off course.

“The introduction of the National Living Wage on April 1st, closely followed by tax changes on April 6th, will disrupt hiring strategies for many businesses. Employers will seek to offset rising wage bills, for example by scaling back recruitment and increasing automation. This could weaken future demand for staff.

“In June, the EU referendum carries a very real risk that business confidence will be curtailed and investment in hiring could falter. It’s vital that we have an informed debate about the impact the referendum might have on jobs, both in the short and long term. All parties must remember that UK employers need access to the global labour market in order to thrive.

“Global economic headwinds only add to the uncertainty around what the months ahead hold, and the Recruitment and Employment Confederation calls on the government to avoid further destabilising the UK jobs market in next week’s Budget.”