Some 76 per cent of employers are planning on increase their number of permanent staff over the next three months, a new report from the Recruitment and Employment Confederation (REC) reveals.

July’s job market figures show that employer confidence is on the up, as permanent staff placements rose from June’s 61.3 to 64.9 on the index – any reading above 50 counts as a positive change, whereas figures below 50 mark a decline. Temporary staff figures increased slightly in July too, from 62.2 to 63, reports ibtimes.co.uk.

However, the report also shows that the UK is continuing to suffer from a skills shortage, as the availability of permanent staff dropped even further from June’s 28.9 to 28.5 in July. Moreover, the number of temporary staff available for hire declined to 36.5 from 36.6.

Although this may not be good news for employers, it means that starting salaries are likely to stay strong, or even rise. REC estimates that permanent starting salaries will increase over the coming months as the market becomes more competitive, reports freshbusinessthinking.com.

Kevin Green, the chief executive of the REC, commented: “The UK’s post-recession problem is skill and talent shortages. The economy is going to be constrained by this ongoing talent crisis if employers keep doing business as usual. Hirers need to take on more young people and train and develop their employees like never before.”