Umbrella Companies Help Boost Recruitment Industry

With ominous storm clouds once again gathering over the eurozone, there are few grounds for optimism about the general economic outlook at present. However, the REC’s latest Annual Industry Trends Survey reveals that, in the midst of such economic dolefulness, the UK’s recruitment industry has seen an extraordinarily healthy growth in turnover during the last twelve months, thanks in large measure to robust demand for PAYE umbrella contractors.

Turnover from permanent posts soared by a surprising 37% on last year’s total of £1.8 billion to hit £2.5 billion this year. Turnover from temporary staffing – much of it generated by contractors working through umbrella companies - leapt from £17.8 billion in 2010 to £22 billion this year. This restores turnover in the recruitment industry to levels not seen since 2006/2007.

Temporary placement volumes rose by 19.3% on last year, surging from 879,000 to break through the million mark at 1,049,333 in 2011. Payroll outsourcing solutions, such as umbrella services, it seems, are catching on amongst employers.

The REC Chief Executive acknowledged that contractors and recruiters alike still face tough challenges ahead, especially with the auto-enrolment of pensions and the bedding down of the AWR in the coming year. The organisation’s Medium Term Forecast, however, suggests that, although it may be unspectacular, the industry will nonetheless see steady growth in the coming four years.

He added “The upsurge of temporary assignments to more than a million again underlines the value of flexible working patterns for both employers and jobseekers.”

Source:

http://www.rec.uk.com/press/news/1850