London salaries grow as companies compete for talent

The average salary for new roles in London in February has grown 2.1 per cent year on year, in a sign that the labour market is tightening, new figures suggest.

Salaries increased by £827 in real terms for workers in the capital, with average wages rising from £38,892 in February 2018 to £39,719 in February 2019, a study by independent job site CV-Library has revealed.

Read more: Wages grow at fastest rate since 2008 as job vacancies hit record highs

The capital saw a six per cent rise in jobs advertised last month, exceeding the national average by two per cent.

But London also experienced a 6.6 per cent decline in applications for new jobs in February.

Vacancies in the rest of the UK crept up by four per cent last month, although there was also a 3.4 per cent decline in candidate applications, according to data about job vacancies on CV-Library's website.

In a sign of the political climate weighing on the jobs market, industries that traditionally employ EU workers struggled last month. Hospitality saw a 15.3 per cent fall in job applications, while driving saw a 7.5 per cent drop.

Sean McKee, director of policy and public affairs at London Chamber of Commerce and Industry, said a recent survey carried out by his organisation showed that “over half of those who tried to recruit had difficulty in doing so … and nearly a fifth felt pressure to increase wages”.

“London has a unique immigration footprint and is far more dependent on an international workforce than the rest of the UK”, he added. “Post-Brexit, it is all the more vital that London has more control on immigration decision-making.”

Read more: Eurozone unemployment falls to decade low

Founder and chief executive of CV-Library, Lee Biggins, said: “It’s not surprising that professionals are showing more caution about applying for jobs right now. With the outcome of Brexit still not confirmed, Londoners want to stay safe in the knowledge that their current employer will protect them, no matter the result of the Brexit deal."

“While this can help many employers with their retention efforts, this does pose an issue for companies recruiting for new positions”, he added.