UK hiring intentions fall to year-low as Brexit negativity takes its toll
The BDO Employment Index for June showed a decline in the number of job vacancies, as well as a slowdown in weekly earnings growth.
The outlook for UK employment has fallen to its lowest in more than a year, as months of Brexit negativity have taken their toll on businesses’ hiring plans, according to new research.
The hiring intentions of UK businesses have slumped for the second consecutive month after six years of sustained growth, according to a new report by accountancy firm BDO.
BDO’s Employment Index, which analyses forward-looking employment intentions, declined by 2.29 points from January to 112.82 points for June.
Peter Hemington, partner at BDO, said: “The glory years of rising UK employment figures could be coming to an end. While the numbers remain in positive territory, growth is slowing.”
According to the index for the past month, the current economic slowdown is expected to halt potential growth in employment opportunities, following years of growth.
The index also highlighted a drop in the number of job vacancies, while weekly earning growth has also fallen back.
Mr Hemington added: “The labour market has been resilient to the potential effects of Brexit, but months of negative sentiment has finally taken its toll.
“Businesses’ hiring plans had remained buoyant in the face of uncertainty.
“But as confidence begins to turn, there’s no sugarcoating the fear that job prospects will take a hit.”
BDO’s latest figures have also shown a sharp drop in UK manufacturing output, with the accountants’ manufacturing index for June falling to 92.83, its lowest figure since December 2016.
Pessimism has also particularly impacted employment in the financial sector, according to a separate survey by recruitment consultancy Morgan McKinley.
The firm’s London Employment Monitor revealed the number of job openings in the City fell by half in the last quarter, compared to the same period in 2018.
It also showed a sharp decline in the number of professionals seeking jobs in London’s financial sector, with a slump of 22% compared to the previous quarter.
The research, which details City hiring trends from April to June this year, contrasts with other sectors such as tech which has seen employment opportunities continue to rise in recent months.
Hakan Enver, managing director of Morgan McKinley UK, said: “While most sectors in Britain have seen an increase in hiring despite the Brexit deadlock, the financial services sector is especially vulnerable to regulatory uncertainty and remains slow.
“Major banking organisations as well as those from the wider financial services space, have refrained from investing in talent due to the lack of clarity.”