KPMG & REC Reveal London’s Job Market Is on a Slipping Roller Coaster
According to the latest joint KPMG and REC report shipped out by S&P Global, the capital’s hiring vibe is turning into a lean‑and‑tight exercise. Let’s break it down.
What the Numbers Are Saying
- Permanent placement slowdown: Companies have been scaling back on full‑time hires since August, and the Budget’s National Insurance hike has only nudged them further.
- November’s slump: This month saw the sharpest drop in permanent staffing over nine months—so yeah, the trend is pretty steady.
- Temp worker churn: All‑time temporary billings have also taken a nosedive, though the decline is holding its breath a bit.
- Redundancies pumping the job flood: The more layoffs there are, the larger the pool of folks looking for fresh gigs.
- Pay rates staying sluggish: Entry salaries and temp wages have both crept upward, but still lag behind the average upward momentum.
Expert Take
Anna Purchas, Senior Partner at KPMG UK, said, “London’s job market is heating up with a dip in new permanent hires at the fastest rate in months. It feels like cash‑cutter mode after the National Insurance bump. Job seekers—wing it’s a rough patch.”
She added a silver lining: “Larger talent pool means stiffer competition on pay. Because of that, employers can scoop up quality at tighter salaries. Meanwhile, candidates who keep learning and stay flexible are the real game‑changers.”
What It Means for Everyone
- Employers: Shred the old “same‑old staff” approach. Think short‑term wizardry plus long‑term skill investment. The goal? Hit the sweet spot where tech and talent stack nicely.
- Job Seekers: Upskill, hustle, and keep your game broad. Those who walk into interviews with multiple skill sets will stand out—like a firecracker in a sea of fidget spinners.
Bottom line: London’s hiring scene is at a crossroads. Companies are tightening budgets while the market churns with job seekers. Only those who adapt—whether through smart rethinking by employers or continuous learning by workers—will thrive.
Permanent placements fall at strongest pace in nine months
November’s Talent Crunch: A Tale of Falling Placements and Boohoo
London’s Placement Plunge
In the capital, recruiters are staring at the numbers that keep slipping down. Four months in a row, permanent hires have been dropping, and the November fall was the steepest in nine months. The slump is running mouth‑watering parallel to the UK-wide average, suggesting a nationwide hangover after the Budget party.
What’s Behind the Decline?
- Sluggish Business Activity: Companies are taking a chill pill, which translates to fewer job offers.
- Budget Shock: The latest fiscal announcement left firms unsure, pulling the hiring thread tighter.
- Wanderlust Workforce: Talent’s eyeing greener pastures, leaving employers scrambling.
Region-Specific Circus
All four English regions saw a sharper drop in new permanent hires in November—except the Midlands, which somehow survived the storm with the weakest dip.
Temporaries – The Benevolent Cloud
London recorded its eleventh consecutive month of falling temp billings. Though the decline slowed to its gentlest pace since August, it remains above the UK average. Reason? Poor sales, cost‑cutting, and a gloomy economic forecast—all in one cocktail of uncertainty.
- North England: Temporary billings dropped again, causing the Midlands to be the lone region showing a slight rise.
- South England & London: Soft decline, less fierce than the prior month.
Permanent Vacancy Vortex
The hunt for full‑time talent has been muddy for four straight months. The curiosity‑laden February record grew into a November 52‑month sliver of rapid contraction.
- All monitored regions fell: This marks the first time in nine months that every region saw a decrease in permanent vacancies.
- Temporary vacancies: Trailing again, giving the North a steady decline while the Midlands flips the script with a minor uptick.
Bottom Line: Hold On Tight!
Recruiters and employers alike should brace for more turbulence as the job market tightens. It’s a reminder that even in a bustling capital, the winds of change can blow in unexpected directions. Stay excited, stay weary, and keep those candidate pipelines humming—because, at the end of the day, the job market’s as unpredictable as a rollercoaster ride at midnight.
Sustained rise in permanent staff availability
Busy Beavers of the British Labour Market
What happened? In November, London kept the trend of more permanent workers that kicked off last December 2022. The numbers fell to an eight‑month low, but that doesn’t mean the momentum stalled—employment is still moving faster than a congestion‑free tube line.
Where the Growth Happened
- South England & London: Growth slowed a shade, but the job market still beats a drum. Recruitment agencies now have a bigger pool of short‑term workers, which is a silver lining if your contract roles are scarce.
- North England & Midlands: These regions lead the pack with stronger bumps in permanent talent.
Short‑Term Surge
Recruiters in London noted a boom in temporary candidates, continuing the upward dance that started in early 2023. The pace slowed from October, but it’s still prime‑time. A growing shortage of contract gigs means more temp folks are on the lookout for the next gig—think of it as a “job‑vacuum” in the market.
Temp Staff Trends
All English regions saw a dip in temp staff supply this month, suggesting the market is temp‑try (pun intended) to keep up with the shift from short‑term to permanent roles.
Starting salary inflation remains historically subdued
Pay Increases Hit a Three‑Month Peak – Still Keeping it Low
The newest survey shows starting salary inflation finally nudged up to a three‑month high after barely moving in the last period. Yet overall pay rises stayed modest – in line with what we’ve seen over the years.
Where It’s Happening (And Where It Isn’t)
- North England: Permanent wages saw the strongest jump.
- South England: New permanent hires actually faced a pay cut.
- Midlands: The only region reporting a dip in temporary wages.
Temporary Pay – Growing, but at a Slower Rate
London logged back‑to‑back increases in temp wages during November. Hourly rates for short‑term workers rose at a slightly stronger pace, but the overall inflation lagged behind the long‑term average. When increases were noted, clients said it was to reward higher skill levels.
Client Perspective
Firms took a pause in November to re‑assess hiring needs after a tough Budget for employers. “The drop in vacancies was mainly in the private‑sector permanent roles, and slower permanent recruitment billings reflected this trend,” says Neil Carberry, REC Chief Executive.
Looking Ahead – Will Businesses Return?
Carberry points out, “The real question is whether companies will re‑enter the market next year with more confidence about the path ahead.” He highlights the resilience of temporary work: private‑sector temp hiring stayed roughly flat nationwide, contrasting sharply with the drop in permanent hiring.
Importance of Temporary Work
London saw the smallest contraction in temp billings since August – underscoring that firms may lean more on temps to navigate current uncertainty. “It highlights how flexible roles benefit both companies and people who need a quick job after redundancy,” Carberry adds.
Policy Implications – Strengthening the Flex Market
Carberry stresses, “Ensuring new regulations support, not weaken, flexible jobs is vital – especially post‑Budget. The Employment Rights Bill should protect agency and temp work, which really matters for people.”
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