UK hiring plans grind to a halt with recession concerns rising
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Rail workers at the London Euston railway station, which is closed due to a national rail strike on Oct 5, 2022.
PHOTO: BLOOMBERG
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LONDON - The British labour market is showing signs of cooling as workers and businesses prepare for a possible recession, a survey has found.
The report by the Recruitment and Employment Confederation (REC) showed that companies are starting to impose hiring freezes because of pessimism about the outlook, and employees are deciding to stay put rather than apply for other jobs.
As a result, vacancies and the number of people placed in roles both rose at the slowest pace in more than 1½ years.
Candidates remained in short supply, however, and firms needing to fill positions were forced to pay up. The rate of starting-salary inflation moderated only slightly in September as workers demanded to be compensated for the soaring cost of living.
"With unemployment at record lows, pay continues to rise for both temporary and permanent workers starting new jobs, and activity levels across the recruitment and staffing industry remain high," said Mr Neil Carberry, chief executive of the REC. "While any economic slowdown this winter will affect the market, the extent of shortages means that hiring will remain a focus for employers."
The tightness of the labour market is a key concern for the Bank of England, which has raised interest rate seven times since December in an effort to prevent a wage-price spiral.
Further increases are anticipated in the coming year, worsening the plight of consumers and businesses already struggling with near double-digit inflation.
Some analysts say the economy may already be in a recession that could stretch into the early months of 2023. BLOOMBERG
