UK businesses are finding it increasingly difficult to fill key positions with workers becoming more reluctant to move jobs at a time of economic uncertainty, a fresh study has suggested.
A survey of 400 recruitment firms by IHS Markit and the Recruitment and Employment Confederation (REC) showed that permanent placements weakened slightly in March from February's one-year high.
The supply of permanent candidates fell sharply – but slightly slower than February's 13-month peak – while the supply of temporary staff fell at the fastest pace since January 2016.
REC warned that the UK's exit from the European Union could considerably worsen skill shortages, especially if tough restrictions are placed on workers arriving from the bloc.
"Finding people to do the jobs on offer is rapidly becoming employers' biggest headache and many are reporting an increasing number of white collar jobs as hard to fill, including in the IT and financial sectors," REC chief executive Kevin Green said.
"Shortage of appropriately skilled, willing and able candidates was a problem before the referendum. Our concern is that Brexit will make the problem worse, particularly if onerous restrictions are imposed on people coming from the EU to work."
The survey found that London and the south of England were particularly suffering from low candidate availability, as workers become increasingly reluctant to move jobs in an uncertain economic climate.
However, staff shortages continued to push up starting salaries for permanent placements in March.
Green added: ""This shrinking talent pool of available candidates means that businesses are boosting the starting salaries and hourly rates they are prepared to offer to the right candidate.
"So for job hunters willing to move roles at the moment, there are financial rewards on offer – especially it seems in finance, IT and other management and office-based professional roles."
Demand for workers in the private sector continued to outstrip demand in the public sector in March, with IT & computing sector reporting the biggest number of vacancies during the month.