UK job postings fell during the first half of 2026 while the proportion of employers seeking artificial intelligence skills reached a record level, according to analysis from Indeed.
Vacancies advertised on the recruitment platform were 11% lower on 17 July than at the start of the year and 32% below their level immediately before the Covid-19 pandemic.
The decline was particularly pronounced for people entering the workforce. Graduate postings were 7% lower than a year earlier on 10 July and stood at their weakest comparable level since 2020.
Summer vacancies, including temporary and seasonal work often used by younger people to gain experience, were also at a four-year low.
Advertised wage growth cooled to 3.9% in the three months to June. That was its slowest rate since February 2022 and suggests that weaker demand for labour is reducing pressure on employers to increase starting salaries.
The overall slowdown contrasts with accelerating demand for AI capabilities. At the end of June, AI tools, programmes, or related skills were mentioned in 9.4% of UK job postings, the highest share recorded by Indeed.
Jack Kennedy, senior economist at Indeed, said: “The UK’s labour market is under sustained pressure. Hiring demand is falling across most parts of the economy, while posted wage growth is gradually cooling.”
He added: “That is particularly challenging for graduates and younger workers, who are competing for fewer opportunities to gain an initial foothold.”
The figures describe a labour market that is weakening in aggregate while becoming more selective about capability. Employers facing higher operating costs and uncertain demand are limiting recruitment, but many are still prepared to hire where technology skills support productivity or new services.
AI demand is not confined to software development. Companies are introducing generative tools into marketing, customer service, finance, legal work, operations, product development, research, and administration.
That creates demand for technical specialists alongside employees who can use, supervise, test, and govern AI systems within established professional roles. Data protection, cybersecurity, model risk, and quality control are becoming part of the required skill mix.
The shift may create a difficult transition for graduates. Entry-level positions often contain routine research, drafting, analysis, and administrative tasks that can be assisted by AI.
Employers may require fewer junior workers to complete the same volume of work or may expect recruits to arrive with stronger technology skills. That pressure is already visible in graduate recruitment processes shaped increasingly by AI use and automated assessment.
A reduction in early-career roles has longer-term workforce consequences. Graduate and junior positions provide the experience through which organisations develop future managers, technical specialists, and professional leaders.
Automating parts of those roles can reduce costs in the near term, but it can weaken internal talent pipelines if businesses do not redesign training and progression alongside the technology.
The data does not establish that AI caused the overall decline in vacancies. Hiring has also been affected by slower economic growth, wage costs, taxes, interest rates, geopolitical uncertainty, and weaker demand across several industries.
It does show that AI capability is becoming more prominent while employers reduce recruitment elsewhere. Workers without relevant skills may therefore face more competition for a smaller pool of vacancies, even when their occupations are not directly technical.
Skills policy will need to account for that divergence. Short courses and certifications can help employees use specific products, but businesses also require broader capabilities in data, problem-solving, critical assessment, security, and sector knowledge.
Employers must decide whether to recruit those skills externally or develop them among existing staff. Internal development can preserve institutional knowledge and widen access to technology roles, although it requires investment while many organisations are controlling expenditure.
The weakening in advertised wage growth may ease inflationary pressure, but it also indicates reduced bargaining power among jobseekers. For younger workers, the combination of fewer openings, lower wage momentum, and higher skill requirements makes entry into sustained employment more difficult.
Indeed’s figures describe a two-speed market: fewer opportunities overall, alongside intensified competition for people able to apply AI effectively. The durability of that pattern will depend on economic growth and whether technology adoption creates new roles quickly enough to offset reductions in traditional recruitment.
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