Economic uncertainty leads to dwindling vacancies in London
Permanent hires in London fell for the eighth consecutive month in November, driven by ongoing economic uncertainty and dwindling vacancies.
According to the latest report from professional services firm KPMG and the Recruitment and Employment Confederation (REC), the decrease in hiring quickened in the capital last month, with the reduction in permanent vacancies one of the most striking since the pandemic.
London recruiters also noticed a significant rise in permanent staff supply with November marking the fastest growth in candidate availability in the last three months, driven by increased reports of redundancies and fewer contracts.
Temporary hirings
While billings received from the employment of temporary staff grew slightly in London, similar to permanent roles, demand for temporary and short-term vacancies deteriorated.
This marked the fifteenth consecutive month of temporary job openings falling, while also marking the fastest rate of reduction since February.
Temporary staff supply also rose last month, the most pronounced since August as more people found themselves being driven into flexible work due to fewer job opportunities.
While this creates a candidate rich market for employers, it also boosts competition for temporary roles.
Anna Purchas, senior partner at KPMG UK, said: “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.”
Salary inflation gains momentum
Average starting salaries allocated to new permanent staff increased in November, due to the pace of inflation reaching its strongest in five months.
Temporary workers also saw an increase in average pay rates, with higher wages being granted to candidates with suitable skills, however the increase “was fractional”.
Neil Carberry, REC Chief Executive, said the improvement in pay rates gives “signs of the market stabilising in London and the UK” but the government must do more “to get the economy firing”.
He said: “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 by comparison 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’.”