Demand for staff shrinks at record pace

LONDON (Reuters) - The number of Britons finding work and demand for staff fell in December at the sharpest rate since at least 1997, while unemployment likely topped two million at the end of last year, a survey indicated on Wednesday.

The job market is being hit hard as the economy slides into its first recession since the early 1990s, with more and more businesses going to the wall and others laying off staff and cutting back on recruitment in an effort to survive.

The Recruitment and Employment Confederation and KPMG Report on Jobs showed permanent job placements falling for a ninth successive month in December, with its index sliding to 28.6 from 28.9 in November -- the lowest reading in the series.

Temporary job placements fell for a fifth straight month, with a reading of 29.8 in December, down from 31.7 in November and also the lowest since the survey began in October 1997.

Any score below 50 suggests contraction.

"These latest figures only serve to confirm the most pessimistic projections for the UK jobs market," said Mike Stevens, Partner and Head of Business Services at KPMG.

"They are also a lead indicator for a rapidly declining employment situation which is not yet reflected in the government's current employment statistics."

REC/KPMG said its December data suggested a three-month rise of 170,000 in the number of people out of work.

"If confirmed, this would take unemployment above the two million mark by the end of the year for the first time since mid-1997," the survey said.