Economic uncertainty has triggered a sustained downturn in permanent job opportunities across London, with hiring activity falling for the eighth month in a row in November. A new report reveals a sharp acceleration in the decline of vacancies, creating a candidate-rich market as more people seek work.
Permanent Placements and Vacancies See Sharp Decline
According to the latest data from professional services firm KPMG UK and the Recruitment and Employment Confederation (REC), the reduction in permanent hires in the capital quickened last month. The drop in permanent vacancies was noted as one of the most striking since the pandemic.
Simultaneously, recruiters recorded a significant increase in the availability of permanent candidates. November saw the fastest growth in candidate supply for three months, a trend driven by more reports of redundancies and a lower number of new contracts being issued.
Temporary Staffing Market Under Pressure
While billings for temporary staff saw a slight increase in London, the underlying demand for short-term roles continued to weaken. November marked the fifteenth consecutive month of falling temporary job openings, with the rate of reduction reaching its fastest pace since February.
The supply of temporary workers also rose markedly, showing the most pronounced growth since August. This shift indicates that more people are being driven into flexible work due to a lack of permanent job opportunities, boosting competition for temporary positions.
Salary Inflation and Calls for Government Action
Despite the hiring slowdown, average starting salaries for new permanent staff increased in November, with the pace of inflation hitting a five-month high. Temporary workers also saw a rise in pay rates, though this increase was described as "fractional".
Anna Purchas, senior partner at KPMG UK, commented on the mixed picture: “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.”
Neil Carberry, REC Chief Executive, stated that improving pay rates were a sign of the market stabilising. However, he issued a pointed critique of government policy: “If the government’s priority is growth, their report card at the end of 2025 reads ‘Must try harder’.” He urged ministers to do more to stimulate the economy.
