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11 Jan, 2023 06:33

UK job market tumbles as economy slows – survey

Vacancies and wages grew at the slowest pace since the pandemic lockdowns of early 2021, the report said
UK job market tumbles as economy slows – survey

Recession fears in the UK are forcing businesses to mothball hiring plans to keep costs at a minimum, a survey by auditing company KPMG and the Recruitment & Employment Confederation (REC) released on Tuesday showed.

Hiring for permanent staff in the UK slumped for a third month in December, falling at the quickest pace since the pandemic lockdowns of early 2021. Vacancies grew at the slowest rate since February 2021 and were accompanied by the weakest pay raise in 20 months, the report said.

“The jobs market looks less than rosy at the start of 2023,” a partner in skills and productivity at KPMG UK, Claire Warnes said, adding that “vacancy growth rates are trending down again this month from a historically high peak in July 2021.”

According to REC CEO Neil Carberry, a slowdown in permanent placements is not unusual in December but “this one comes as part of a wider softening trend in the permanent market.”

Starting salaries for permanent staff and pay rates for temporary workers grew at the slowest rate since April 2021, the survey showed, indicating that employers have grown more cautious about hiring and halted plans to take on workers until January, awaiting the next report on this year’s outlook.

“Industrial relations turmoil in many sectors, along with the scarcity of available staff in all sectors, means that wage inflation may soften only slightly in the near term,” Warnes said.

Inflation remains one of the biggest concerns of recruitment companies in the UK amid forecasts that the British economy looks set to contract in 2023. The Bank of England has lifted its key rate nine times since December 2021 in an effort to rein in spiraling price growth.

For more stories on economy & finance visit RT's business section

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