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London - British recruiting firm Hays has said skill shortages are pushing up some white collar salaries as much as 10%, contrasting with generally slack wage growth and signalling wage pressures in some parts of the economy.
The company, one of Britain's biggest jobs agencies, said pay for its skilled and professional clients in its home market was already growing by between 2% and 3% on average as demand grows in areas such as finance, accounting, IT and construction.
It also said it had placed 20% more UK permanent staff in the last quarter than the year before, the fastest growth for eight years.
The findings could be significant given that Bank of England (BoE) policymaker Kristin Forbes recently warned that the strength of sterling could be masking some underlying inflation pressures.
"It is becoming increasingly important to monitor trends in domestically generated inflation - and especially unit labour costs - so that monetary policy can be adjusted appropriately," Forbes said in a speech.
Hays chief financial officer Paul Venables told Reuters he expected wage levels for skilled professionals to rise by 3% next year in the UK and Ireland, particularly in financial services.
"I think it is a pretty confident market, so if we are seeing 2 to 3% now, I would be pretty confident we would be seeing 3% in a year's time," said Venables.
Skills shortages in construction and property have seen wage growth rises of up to 10%, Venables added, as companies sought to fill specialised roles left vacant after the recession.
The figures contrast with the economy as a whole where the earnings of British workers have struggled to stay above 1% over the past year, lagging inflation, despite unemployment falling to its lowest since late 2008.
Hays posted an underlying 13% rise in first-quarter net fees for the UK and Ireland, an acceleration on the 11% it recorded in the full-year ending June 30.
And it said the number of permanent jobs it had filled grew by 20% in the first quarter on a like-for-like basis, the highest increase since 2006.
Temporary placements grew by 7%.
Strong demand
The recruiter, which operates in 33 countries, said major specialism sectors like accountancy and finance, construction and property, and IT all grew by more than 15%.
Hays posted underlying 9 percent rise in first-quarter group net fees, boosted by strong demand in its three biggest markets Australia, UK and Ireland, and Germany. That reflects an acceleration on the 5% it recorded in the full year and 7% in the last quarter.
"This is a good start to the year ... I see no reason why at the moment we won't continue at that sort of level. We had a good year last year, I think we will have a better year this year," said Venables.
Shares in Hays were 3.8% higher at 125 pence by 11:23 GMT, one of the biggest gainers in the FTSE 250 index.
"Hays' first-quarter results reassure, broadly continuing the rate of growth achieved in the preceding two quarters," said Liberum analysts who have a "buy" rating on the stock.
Total net fees for permanent placements grew by 12% in the first quarter, on a like-for-like basis, whilst temporary placements grew by 7%.
Net fees in Australia, UK and Ireland and Germany grew simultaneously for the first time in nearly four years, with 11 of businesses delivering record quarterly net fees. As a result Hays increased its own consultants by 4%.
Venables said Australia, which has suffered in recent years due to a slowdown in mining, returned to growth for the first time in two years, six months earlier than he had expected.
"It has been much stronger than we expected and it's going to accelerate, so we would be very confident that the next time we are talking it will be much closer to 10% growth," he said.
Asia Pacific and continental Europe also performed well, with fees rising 6% and 8% respectively.
Hays said it expected currency translations to reduce operating profit for the year ahead by around £7m, citing the strength of sterling against the Australian dollar and the euro as the main reason for the difference between actual and like-for-like net fee growth rates.
