UK Labor Market Conditions Deteriorate In November

(RTTNews) - The UK labor market conditions deteriorated further in November as firms paused recruitment activity following the late October budget announcement, a report compiled by S&P Global showed on Monday.

Permanent job placements posted its biggest fall since August 2023 amid reports of reduced vacancies, the KPMG/REC Report on Jobs said.

Many respondents said that the Autumn Budget had led to uncertainty and the reassessment of staffing needs. Temporary staff billings declined for a fifth straight time due to similar reasons. Salary growth of permanent staff was almost unchanged on October's 44-month low in November. Temp pay rates rose only moderately and to a slightly lesser extent than in October.

Data showed a sharp and accelerated fall in vacancy numbers. Staff demand decreased for the thirteenth consecutive month and the latest fall was the greatest registered for over four years.

Recruitment consultants reported the steepest increase in staff availability for three months to November. There was sharp growth for both permanent and temporary worker supply.

"Businesses are having to weigh up the prospect of increasing employee costs following the Budget, which has led to an accelerated slowdown in hiring activity across the board," KPMG Group Chief Executive and UK Senior Partner Jon Holt said.

The fall in recruitment and rising availability of candidates could put more downward pressure on wage inflation, Holt noted. This trend will be encouraging the Bank of England's monetary policy committee ahead of the next meeting later this month, he added.

"However, the prospect of further rate cuts through 2025, alongside the Government's investment plans, both point to improved growth in the near term," Holt added.