EU Oct Online Recruitment Up; France, UK Lead Uptick - Survey

LONDON -- The online jobs market in the European Union improved in October for the first time since February as some optimism returned across the region, particularly in France and the U.K., a survey showed Tuesday.

The monthly Monster employment index rose to 99 points in October from 97 in September, suggesting the soaring rates of unemployment being reported in the major European economies may be coming to an end.

"Increased optimism about economic recovery prospects led employers in primarily France and the U.K. to resume hiring in October," said Hugo Sellert, head of economic research at Monster Worldwide.

Sellert cautioned that while it was good news to see a rise in the index, with the index remaining at very low levels it may be some time before the labor market begins to add jobs more convincingly.

"At this point employers are very hesitant to add workers as they're not convinced as to how sustainable any upturn their firms may be experiencing will be," Sellert said.

The rise in demand for staff in France was not only driven by an increase in business activity, but also by a traditionally seasonal change, the index showed.

"While there is some volatility in the monthly index, France appears to be in fairly good shape as we emerge from the recession in comparison with Germany who held up better at the beginning of the downturn,"

France is poised to report a second straight quarterly gross domestic product rise for the third quarter Friday, in line with improving confidence and the recent strength seen in both the manufacturing and services purchasing managers indexes.

The pickup in the U.K. was driven by demand for staff in education and also manufacturing and transport, the survey showed.

However, with government plans to cut public sector spending, the sector which has bolstered U.K. employment in recent months may not be able to provide similar support next year.

"The public sector may not be able to provide the same support to the jobs market in the recovery as it did going into the recession," Sellert said.

"We've seen the impact of the manufacturing sector rebounding and strong rises in industrial activity should see that continuing," he said. He added that there has also been a pickup in recruitment activity in sales and marketing, "suggesting that confidence is slowly returning."

A rise in new hiring in the U.K. will boost hopes that after a disappointing quarterly GDP fall in the third quarter of the year firms are showing signs of growth in the final quarter of 2009.

Monster also reported that recruitment activity in Germany fell for the second straight month in October, the only country to report two straight months of declines this month.

Monster's Sellert said some of the boosts to employment earlier in the year were likely artificial and government-led ahead of the election.

"As the impact of those initiatives fade, reality might be catching up. Confidence and exports are improving but have yet to spill over into the jobs market," he said.

The latest euro-zone unemployment index rose to a ten-and-a-half year high of 9.7% in September from 9.6% in August, suggesting consumer demand will remain muted for some time to come.

While the unemployment rate continues to rise across both the euro zone and in the U.K., the pace at which it is doing so has slowed from earlier in the year as confidence and output have both showed signs of improving in recent months.