London's job market weakened at the fastest pace since 2020, according to new figures that the capital's business leaders said are a ‘clear message to the Chancellor’.
The KPMG and REC London labour market pulse check, supported by BusinessLDN, showed vacancies falling for the tenth consecutive month. But the decline accelerated in December, with a pulse reading of 47.0, which is weaker than the rest of the UK. Any reading below 50 represents decline while any figure above 50 represents growth.
The number of candidates available for work also increased for the 12th month in a row. Permanent placements were down, but not as sharply as in December.
Anna Purchas, Senior London Office Partner at KPMG UK, said: “âAfter a difficult year for the UK economy, London’s labour market remains out of sync: we’re seeing even more Londoners looking for work, with candidate supply rising at the fastest pace since the initial pandemic wave three years ago, while the number of available roles continues to fall.
“Cautious employers in the capital have been reigning in permanent hiring and moving towards temporary staff in a bid to keep their businesses going as they ride out the sustained economic slowdown. However, we are seeing significant variations by sector, with signs of optimism about permanent recruitment in London’s key sectors including construction, education, hospitality and life sciences over the next four to twelve months.”
Muniya Barua, Deputy Chief Executive of BusinessLDN, said the figures should be a warning to Jeremy Hunt.
“The protracted slowdown in London’s jobs market is sending a clear message to the Chancellor: he needs to deliver a bold pro-growth package in the March Budget,” she said.
“Reversing the decision to scrap VAT-free shopping on goods for international visitors would provide an immediate economic boost. Going further to make childcare more affordable and accessible would help more people return to work. And providing the clarity needed to accelerate housebuilding would help to unlock jobs, growth and more homes for Londoners.”
It comes as official figures show that the UK's GDP rose by 0.3% in November, ahead of market expectations but not enough to stave off fears of a technical recession. December's figures, published next month, will determine whether the economy declined for two straight quarters.
