UK Job Market Contracts Sharply as Employer Costs Surge

New hiring slows to its weakest pace since 2020, with businesses citing tax hikes and economic uncertainty as key factors.

Permanent job vacancies in the UK have declined for the 15th consecutive month, reaching levels last seen during the pandemic in 2020.
A £25 billion increase in employers' National Insurance contributions, set to take effect in April, is cited as a major factor behind reduced hiring activity.
The Bank of England has halved its 2025 economic growth forecast to 0.75% and expects unemployment to rise to 4.75% by the end of the year.
Business confidence remains low, with companies adopting a 'wait and see' approach to hiring and scaling back investments due to tax burdens and economic uncertainty.
Pay growth for permanent staff has slowed, with salaries increasing at their softest rate since March 2021, reflecting weaker labor market conditions.