Economic revival at risk due to harsh economic gusts - JobPerspective
In a positive turn of events, the employment landscape in the United Kingdom is experiencing a revitalisation, with both short-term and medium-term hiring intentions showing signs of improvement. According to recent reports, the balance of sentiment towards short-term use of temporary and contract workers has been restored to positivity, with a 3-point increase to net: +3 [1]. This optimism has further surged in the last month, up 5 points to net: +5 in April 2025 [2].
This improved outlook is influenced by several factors. Renewed employer confidence and sector-specific growth are driving the increase in vacancies, with sectors such as technology, fast-moving consumer goods (FMCG), energy, real estate, financial services, healthcare, and infrastructure experiencing a rebound in hiring demand [2]. Regional hubs like Manchester, Birmingham, Leeds, and Bristol are also showing strong hiring activity, contributing to a broader market recovery and more balanced hiring patterns across the UK [2].
The adoption of technology and hybrid work models is another significant factor. The rise of legal technology adoption helps organisations streamline workflows, manage risks, and improve efficiency, encouraging hiring growth. Additionally, hybrid and flexible working arrangements enhance attractiveness for candidates, particularly outside London, further supporting medium-term hiring optimism [2].
However, employers remain cautious amid economic uncertainty, influenced by geopolitical turbulence, rising costs, and fears around taxation. This produces volatility in hiring rates but does not negate the overall improved outlook [1][4]. Historic tax increases and cost pressures are also restraining the hiring pace [1].
The UK market is increasingly demanding data specialists, such as data analysts, scientists, engineers, and architects, aligned with the growing reliance on data-driven decision-making. This skills demand positively influences hiring prospects in tech-related roles [5].
In London, there has been a notable bounce back on short-term temp hiring, with a shift from net: -3 in the three months to February to net: +13 in the three months to April [3]. On medium-term temporary hiring in London, there was a significant improvement, with a shift from net: -5 to net: +10 [3]. The hiring intentions for medium-term recruitment of temps experienced a five-point rise across the quarter (+8) [3].
The medium-term hiring outlook, for the next four to 12 months, improved by four percentage points in the three months to April 2025 (+9) [1]. The short-term permanent hiring outlook for the next three months improved by three points to net: +9 in the three months to April 2025 [1]. The medium-term hiring intention in London for the next four-12 months was restored, bouncing from net: -2 to net: +19, quarter-on-quarter [3]. This bodes well for immediate recruitment, such as summer seasonal hiring 2025.
Despite these positive trends, employers' perceptions on how the UK economy was performing were a notable 12 points lower - at net: -35 - than in the three months to February 2025 [1]. Employers' confidence in making investment and hiring decisions similarly fell, by 5 points to net: -9 February-April 2025 [1]. However, the improved hiring outlook for Q2 and medium-term periods is a promising sign for the UK economy's recovery.
References: [1] Recruitment & Employment Confederation (REC) [2] EY Parthenon UK Labour Market Tracker [3] KPMG and REC UK Job Market Survey [4] Institute for Employment Studies [5] Tech Nation Talent Report 2021
The increased hiring intentions in various sectors, such as technology, finance, and real estate, are contributing to a broader market recovery in the United Kingdom, owing to renewed employer confidence and sector-specific growth [2]. This revitalization of the employment landscape has also fueled the demand for data specialists, like data analysts and engineers, as businesses increasingly rely on data-driven decision-making [5].
