WAGES and salaries in Glasgow are continuing to rise at record levels as firms try to counter a growing skills shortage to fill job vacancies.

City businesses are showing firm demand for new staff due to the booming local economy, says to a new report.

But economists at the Bank of Scotland warn a dearth of qualified jobseekers has led to a tight labour market, forcing firms to pay top wages due to competition for staff.

Nursing and medical care workers are the most sought after, with staff shortages also running at record levels in the engineering and construction, IT and computing, and accountancy and financial services industries.

It's claimed some workers in these sectors can almost write their own pay cheque.

The Bank's latest Scottish Labour Market Report, published today, reveals that staff availability fell for the 37th successive month in March, with a third of recruitment agencies reporting a fall.

The study says: "Competition for quality candidates led to further increases in salary.

"Permanent staff salaries continued to rise in March with more than a quarter of recruitment agencies reporting a rise."

Permanent staff shortages were greatest in Glasgow - where skills shortages are the most widespread in Scotland - leading to higher wages.

Local recruitment agencies said the strong labour market was due to clients' "rising workloads".

Rising numbers of vacancies reflected "high levels of business confidence at companies" due to the healthy economy.

Overall the bank's "barometer", which rates conditions based on staff demand, appointments, Scottish staff availability and pay, was in line with the rest of the UK.

Tim Crawford, group economist at Bank of Scotland, said: "Our survey shows that employment growth in Scotland has firmed.

"However wages and salaries continue to rise as companies compete for qualified staff.

"Skills shortages are also more of an issue in Scotland than in other parts of the UK."