UK hiring slumps to lowest level in a decade as job vacancies shrink
UK hiring has hit a decade low and is expected to get worse due to fewer job vacancies, according to a new report.
The accounting and business advisory firm BDO said UK employment is at its weakest since August 2013. The index fell for the sixth month in a row to 99.12 points. Despite small increases in optimism from business owners in December, BDO predicts that UK GDP growth will remain stagnant due to higher borrowing costs and inflation.
Business confidence is showing slight growth, but it's being held back by the cost-of-living crisis, reduced spending, and international conflict. BDO expects UK employment to decline further because of "uncertainty" around interest rates and weak business demand.
The unemployment rate could reach a high of 4.6% over the second and third quarter of 2024 due to ongoing worries about the labour market, the report suggests. The Office for National Statistics (ONS) recorded an unemployment rate of 4.2% over the three months to October in its most recent data.
Kaley Crosswaite, a partner at BDO, said: "It's encouraging to see our resilient services sector spearheading a small upturn in Optimism and Output during December, as the festive season offered a welcome respite for businesses."
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UK businesses are entering 2024 on a "brighter" note a more positive note than in 2023, according to BDO.
"As companies gear up for 2024, it is critical that businesses see renewed support from the Government to enhance their productivity, increase their recruitment and bolster their skills. Only with this support can we continue to revive the economy," Ms Crosswaite added.
* An AI tool was used to add an extra layer to the editing process for this story. You can report any errors to [email protected]
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