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Employers are favouring temporary workers over permanent staff, according to latest employment statistics.

March's monthly report on jobs – by the Recruitment & Employment Confederation (REC) and KPMG – has signalled a brisk growth in temporary staff.

This could be good news for students looking for temporary jobs to supplement their studies.

Report authors REC and KPMG believe that the trend is that employers continue "to favour flexible workforces".

Helen Reynolds, acting chief executive officer of the REC, said that the modest rise in permanent jobs indicated that the labour market is "holding up".

Alan Nolan, director of KPMG, added: "No matter what sector, employers are becoming increasingly cautious about the outlook.

"Demand for staff is slowing and employers are hedging their bets with more emphasis on temporary hires, while pay pressures are easing somewhat."

The report provides the most comprehensive guide to the labour market in the UK, drawing on original survey data by employers and recruitment consultancies.

February's report showed a drop in permanent staff appointments for the first time since May 2003.

A contrasting trend for temporary staff was revealed as appointments rose at the fastest pace for three months.

Mr Nolan commented that the credit crunch and discussions around recession had taken their toll on the labour market.

He added that it was no surprise that employers were dealing with an uncertain economy by moving towards a flexible workforce.

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