A slowdown in the jobs market last month indicates that the public sector recession is starting to have an effect, according to a new jobs report.

The ‘Report on Jobs’ by KPMG and the Recruitment and Employment Confederation for July showed that job vacancies across all sectors increased at the slowest rate for eight months, with the availability of permanent candidates also falling.

In the IT sector, permanent staff skills that were reported to be in short supply were those in SAP, Perl, .NET, business analysts, IT security and office support. Temporary IT business analysts were also in short supply, as well as contract Sharepoint developers.

The report is based on a survey of 400 UK recruitment consultants, and as well as asking consultants to name specific skills that in short supply, uses a figure to represent demand in each job sector. A figure below 50 indicates a drop on the previous month.

Permanent (58.7) and temporary (56.5) IT staff ranked third in terms of growth in demand last month. IT was behind the engineering and construction industry which saw the highest growth in demand for both permanent and temporary staff. Bernard Brown, partner and head of business services at KPMG, attributed this strong demand to the sustained recovery in the manufacturing sector.

Kevin Green, chief executive of the REC, said: “This month’s data confirms a significant deceleration in the jobs market with the rate of expansion easing to an eight-month low. This is the first real indicator that cuts in the public sector are beginning to bite.

"Nowhere is this more apparent than in nursing and medical care where demand for both permanent and temporary staff has fallen away drastically compared to last year when it was the only sector experiencing growth.”

This report contrasts with another recent jobs survey, from IT recruitment website CWJobs.co.uk, which revealed an eight percent increase in the number of permanent IT jobs advertised in the latest quarter, despite a contraction in the public sector.