The rates of decline were the second-quickest in the survey’s history, having eased only slightly from record rates seen in April.

Meanwhile, salaries awarded to permanent new joiners continued to fall, with the latest reduction the quickest on record. Demand for staff declined further, with the drop in both permanent and temporary vacancies historically marked, despite easing from April.

Recruitment consultants across Scotland signalled a further rapid fall in permanent placements in May, which extended the current sequence of decline to four months.

According to respondents, many firms had continued to place hiring decisions on hold due to substantial uncertainty surrounding the coronavirus pandemic.

The drop in May was not as quick as that seen in the previous survey period, but was still severe and the second-steepest in over 17 years of data collection.

Temp billings across Scotland declined in May, as has been the case in each of the past six months. The pace of reduction softened from April’s record, but was still the second-quickest in the series history and marked overall. Panellists linked the fall to the COVID-19 pandemic and subsequent drop in demand for staff.

Recruiters in Scotland signalled a reduction in the availability of permanent candidates during May, as has been the case in each month for over eight years.

That said, the latest fall was the softest since September 2016 and only modest overall. Some panellists reported that redundancies resulting from the coronavirus pandemic had increased the number of available candidates.

Latest survey data indicated a back-to-back monthly increase in the availability of temporary candidates in Scotland during May. Respondents frequently linked the rise to job cuts and redundancies amid the COVID-19 pandemic, which resulted in a higher number of job seekers. Furthermore, the increase in the supply of temporary staff was the quickest since August 2010 and substantial overall.

May data highlighted another fall in salaries awarded to permanent new joiners in Scotland during May, extending the current sequence of decline to two months.

Sebastian Burnside

Moreover, the reduction in starting salaries was the most severe since data collection began in January 2003.

Recruitment agencies in Scotland reported a further reduction in average hourly pay rates for short-term staff in May, with the rate of decline the quickest since April 2009 and marked overall.

May data also highlighted a reduction in permanent vacancies in Scotland, as has been the case in each of the past three months. The rate of decline was the second-quickest on record and rapid overall, and exceeded only by the drop in April.

Recruitment consultants in Scotland signalled a third successive monthly reduction in temporary vacancies during May. The rate of decline softened from April’s record, but was nonetheless the second-sharpest in the series more than 17-year history.

Sebastian Burnside, chief economist at RBS said: “The Scottish labour market continued to face extremely challenging conditions in May, as lockdown restrictions to combat the COVID-19 pandemic continued. Both permanent staff appointments and temp billings continued to fall rapidly, with the declines the second-quickest on record after April.

“Meanwhile, demand for staff continued to drop substantially amid heightened uncertainty over the outlook, while firms reduced pay rates to minimise costs. Permanent starting salaries declined at the quickest rate on record and temp pay rates fell to the greatest extent since April 2009.

“Government support and furlough schemes have been vital to steadying the labour market, but it will be an immense challenge to get business back on its feet and for economic conditions to recover from the pandemic.”

• Read all of our articles relating to COVID-19 here.