New UK budget hits job market: Employment index shows worst drop since pandemic
British employers hit pause on hiring after Labourʼs first budget brings tax changes. Worker demand index drops to lowest point in four years while businesses re-think their employment plans
The UKs job market took an unexpected hit as worker demand crashed to a four-year low after Rachel Reeves new budget rollout. The latest numbers from the Recruitment and Employment Confederation (REC) and KPMG show the staff-demand index fell to 43‚9 - a level not seen since the covid-era
Full-time job placements dropped faster than any time since late summer - while temp work slowdown got a bit better than oct (showing how businesses are dealing with new tax rules). Neil Carberry RECʼs boss points out: “its not shocking that companies needed time to think about hiring after such a tough budget“
- Only covid lockdowns
- The 08-09 money crash
- The post-9/11 period
showed worse numbers in the index history
A Bank of England check found that more than half of companies plan to cut jobs because of higher costs; while private-sector pay deals went down to 3‚9% in the aug-oct period. The CBI also dropped its growth forecast for next yr - though some experts say other budget parts might help growth
Jon Holt from KPMG UK sees some good news ahead: cheaper borrowing costs expected in 25 and government spending plans could make things better. Meanwhile Reeves says this budget is just a one-time fix for public money; promising business owners theyʼll get more stable tax rules to plan ahead
