A survey of the labour market shows that the employers in Britain have decided to have a wait and watch attitude as far as hiring new hands are concerned and the demand for new workers has tumbled to a seven-year low.
ManpowerGroup said years of strong jobs growth had ended in 2019 as Brexit uncertainty and a slowdown in global trade took their toll on business confidence. The recruitment firm’s survey of 2,101 employers found the outlook for the first quarter of 2020 was weak with hiring intentions by firms in London at a 10-year low. A balance of companies, when asked whether they intended to hire additional workers or reduce the size of their workforce in the coming quarter, registered +2%, the lowest figure since 2012.
London, which has among the largest number of employers and usually offsets poor figures from the UK’s regions, was among the worst affected after hiring intentions dropped five percentage points from the fourth quarter to -1 for the first three months of 2020. However, the east Midlands, described by the survey as a “bastion of positivity for many years”, fared even worse: employer hiring confidence fell 15 percentage points to -2%, its lowest level in more than a decade. Wales dropped to -1%, Yorkshire and the Humber hit -1% and the north-east declined to -4%.
ManpowerGroup said the normally buoyant market for workers in London’s financial sector began to dry up in the summer and had contracted ever since, particularly among accountancy and law firms that once aggressively recruited staff. The report, which is used as a key economic indicator by the Bank of England and the Treasury, says: “Declining levels of confidence in almost every sector and region paints a sluggish picture for the start of 2020, with only a few bright spots.”
Official surveys have found that hiring has stalled and wage growth has begun to decline as firms said they were preparing for the threat of a no-deal Brexit and a slowdown in trade amid the US-China dispute over import tariffs. The Office for National Statistics said in a report covering the three months to September that employment had fallen by 58,000 – the biggest drop since May 2015.