Rising costs, staffing problems and savings targets are piling pressure on services.
Survey: Pay Falls Fastest In Scotland
A north-south pay divide is widening as job vacancies outstrip candidates, according to a new study.
Jobs site Adzuna said there were now two vacancies for every jobseeker, fuelled by a "festive jobs boom''.
But advertised salaries have fallen for three months a row, partly due to a rise in temporary posts.
Pay has fallen fastest in Scotland and the North East but has remained more resilient in the South East and East Anglia, research found.
The biggest boom in jobs has been in customer services, which has also bucked the trend on pay, with average salaries rising by 4% over the past year.
Other jobs where pay has increased include consultancies, recruitment and property.
Education has seen a big rise in vacancies but a 1.8% fall in advertised salaries.
Doug Monro, of Adzuna, said: "Twice as many jobs should mean twice as many choices for jobseekers, but this is only true for those with the right skills.
"Rising vacancies are signalling a spiralling skills gap which appears to be worsening as many positions are left empty.
"As the festive season approaches, employers and companies are yet again reliant on the delicate yet crucial role internally migrating workers and workers from overseas have to play.
"Many of the jobs currently being born are temporary positions, leaving workers without long-term job security and reliant on the seasonal economy.
"A great divide is opening up in advertised salaries as the north sees advertised pay rates slip more quickly than the south.
"Northern cities continue to struggle to reduce job competition as there simply aren't enough suitable jobs on offer within the region, and those areas with new openings often lack the applicants with appropriate skills.
"Part of this problem comes from graduates being drawn south by the charm of the capital, but more than that public-sector jobs have not been restored within the area and there still remain gaps within the northern labour market, which the private sector has yet to fill.''
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