Economic uncertainty reduces London job vacancies

Permanent hires in London fell for the eighth consecutive month in November, influenced by ongoing economic uncertainty and dwindling vacancies. According to the latest report from KPMG and the Recruitment and Employment Confederation (REC), the decline in hiring accelerated in the capital last month, with the reduction in permanent vacancies being one of the most notable since the pandemic.

London recruiters also observed a significant rise in the supply of permanent staff, with November marking the fastest growth in candidate availability in the last three months. This was driven by increased reports of redundancies and fewer contracts.

While billings from the employment of temporary staff grew slightly in London, demand for temporary and short-term vacancies deteriorated. This marked the fifteenth consecutive month of falling temporary job openings, with the fastest rate of reduction since February. Temporary staff supply also rose last month, the most pronounced since August, as more individuals were driven into flexible work due to fewer job opportunities. While this creates a candidate-rich market for employers, it also heightens competition for temporary roles.

Anna Purchas, senior partner at KPMG UK, commented: “November’s figures show employers are still being careful about permanent hiring, but it’s encouraging to see temporary demand picking up as employers look to short-term contracts to help them to meet staffing needs. That suggests there is now some positive movement in the London jobs market.”

Average starting salaries for new permanent staff increased in November, with inflation reaching its strongest pace in five months. Temporary workers also experienced an increase in average pay rates, with higher wages granted to candidates with suitable skills, although the increase was described as “fractional.”

Neil Carberry, REC Chief Executive, noted that the improvement in pay rates provides “signs of the market stabilising in London and the UK,” but emphasised that the government must do more “to get the economy firing.”

He added: “Pre-Budget nerves knocked temporary recruitment back just a little in November in the UK after a growing October, but the overall picture was still relatively benign compared to the last year. While the Budget was not the horror show of last year, there was little in it to fire the heart of firms. If the government’s priority is growth, their report card at the end of 2025 reads ‘Must try harder’.”