The number of job vacancies have cratered in wake of the Autumn Budget, as UK companies double-down on existing staff due to the increased cost risk of new labour. The governmental cocktail of growth splashed with double shots of misery and served with an umbrella of tax increases is not proving a popular choice on the happy hour board.
New data suggests UK employers are recruiting at their lowest level in over four years: a consequence of the sharp employment cost increases put in place as part of the Autumn Budget.
A joint job vacancies index collated by KPMG and the Recruitment and Employers Confederation saw its biggest year-on-year contraction since August 2020, with a similar sharp reduction in the number of successful staff placements.
And some of the country’s largest companies are seemingly not immune from the cutbacks: with Tesco recruiting 26,000 people in October (down from 30,000 last year) and Sainsbury’s looking to fill 20,000 positions (down from 22,000 year-on-year).
Meanwhile, concerning numbers from recruitment site Indeed highlight a particularly alarming drop-off in the number of temporary seasonal positions being advertised this Christmas, despite an increased number of job-seekers. Whilst overall job postings are down 14 per cent on pre-pandemic levels, seasonal temp jobs are down a full 46 per cent on Christmas 2019.
UKHospitality chief exec Kate Nicholls has attributed this trend to a wider shift towards long-term retention of staff, with employers now unwilling to risk a sizably increased investment in new employees.
“We’re seeing greater job security, more permanent contracts, but more flexible contracts, which means you don’t see as many adverts for just Christmas jobs as you used to,” she said.
Interpreting the broader picture, KPMG group chief executive Jon Holt said that British businesses were now “having to weigh up the prospect of increasing employee costs.” The increase in mandatory national insurance contributions had, Holt argued, “accelerated slowdown in hiring activity across the board.”
Meanwhile, Indeed top brass have said that retail-facing business are facing a particularly tough fight: and a two-front war against reduced consumer means and increased operational costings.
“Consumers are still feeling the pinch from cost of living pressures while retailers’ costs have increased amid strong wage growth in the sector,” the recruiter’s senior economist Jack Kennedy remarked. “While retailers weigh the impact of the Budget measures, they will be mindful of protecting their margins.”
UK job applications rise 286 percent month-on-month
It’s an ironic twist that at the time businesses are cutting back on recruitment, there are now more people looking for employment.
A study from recruitment platform Tribepad has found that the number of job applications submitted in November rose 286 percent on the prior month, with 48.7 applicants for every advertised role.
More than 4.5 million people put themselves forward for jobs between September and November, 67 percent up on 2023, while the number of positions available dropped by 24 percent over the same period.
This is in stark contrast to earlier in the summer when operators in the hospitality could not find applicants for many of their posts.
“This imbalance – few jobs and a glut of applicants – is putting employers and candidates on edge,” reported Business Matters. “Despite the rollout of shared hiring platforms and automated recruitment tools, employers are facing a flood of applications that can be difficult to manage.”
“Meanwhile, workers are feeling the squeeze. After 28 consecutive months of declining vacancies, opportunities are scarce and competition fierce. While certain sectors, including retail and hospitality, offered a brief autumn reprieve, many businesses are either scaling back permanent hires or shifting resources elsewhere.”
