Only four percent of employers reported that they had reduced their use of agency workers in direct response to the Agency Worker Regulations, according to on-going analysis of the impact of the one-year-old rules conducted by the Recruitment and Employment Confederation (REC).

Further findings from the REC’s Industry Research Unit that have been sent to new Parliamentary Under Secretary of State for Employment Relations Jo Swinson ahead of a meeting later this month include: Only one in 10 employers had stopped or significantly decreased the use of temporary staff in the seven months to April 2012. (A further 18 percent said they had marginally reduced their use of agency workers.) Of the 28 percent of employers who said they had in any way reduced their use of agency staff, two thirds said it was because of continued economic uncertainty and weak growth.

Overall satisfaction with being a temporary worker increased from 43 percent to 52 percent in the first seven months of AWR’s implementation. Employer satisfaction with staffing agencies remains high, at 92 percent. The REC’s CEO, Kevin Green, says: “One year in it’s clear to us that there have been only limited problems for businesses, some real positives for workers and that it’s recruitment agencies across the UK who have really absorbed the administrative burden and costs associated with the implementation of the new rules. “Of the minority of employers who reduced their use of temps most of them made that decision because of the wider financial climate, rather than it being a knee-jerk reaction to the new regulations. So it makes sense that demand for agency staff will pick up as growth returns. In fact, our latest data shows that there’s already been a turnaround and the outlook for temps is starting to improve despite the fact we’re still officially in a recession.

“Jo Swinson has a key decision to make about the future of these regulations. The government should either hold a substantial review which looks at all the relevant issues including pay, assignment lengths, bonuses – or they should leave it alone. What we don’t want is businesses’ time and energy being wasted on a partial review that upsets the current system, creates uncertainty and could risk interfering with the work of agencies and employers making effective use of temporary staff and keeping the temporary labour market buoyant.” Falling labour productivity and rising costs will test resilience of the labour market