Data from the latest KPMG and REC, UK Report on Jobs: North of England survey showed reductions in both permanent staff appointments and temporary billings in the penultimate month of the year. Notably, it marked the first decline in the latter for three months. Meanwhile, there were further reductions in job openings across the region, and pay trends remained weak. The decrease in starting salaries was only slight, however.
The KPMG and REC, UK Report on Jobs: North of England is compiled by S&P Global from responses to questionnaires sent to around 150 recruitment and employment consultancies in the North of England.
Permanent staff hiring declines at stronger rate
November survey data revealed a decrease in the number of staff placed into permanent roles across the North of England, thereby stretching the current trend of decline to nearly two-and-half years. The latest reduction was rapid and the most marked since July. In anecdotal evidence, recruiters noted that some firms were carrying out hiring freezes due to weak market conditions, with some decisions on hold ahead of the Autumn Budget. While all four monitored English regions recorded falls in permanent placements, the fastest was seen in the North of England.
For the first time in three months, recruiters based in the North of England signalled a reduction in temporary billings, as indicated by a sub-50.0 reading in the respective seasonally adjusted index. Panellists noted that amid challenging economic conditions, demand for temporary staff was also weaker and companies showed hesitancy towards hiring. The rate of contraction was solid and the strongest seen for four months. The South of England was the only other monitored region to record a fall and one that was faster than that seen locally.
The downturn in permanent and temporary vacancies deepened across the North of England in November. For both types of roles, the rates of decline were stronger than those seen UK-wide. The former recorded a rapid decrease in job openings that was the strongest seen since March. For temporary vacancies, the reduction was the most marked since the opening month of the year.
Permanent labour supply rises at faster pace
The availability of permanent staff increased again across the North of England, thereby stretching the current growth trend to nearly two years. The rate of expansion accelerated from October and was amongst the sharpest recorded since the COVID-19 pandemic. Where recruiters noted an increase, they generally linked this to a combination of fewer vacancies and redundancies. Of the four monitored English regions, only the South posted stronger growth in labour supply than that seen locally.
There was a sustained increase in temporary staff availability across the North of England in November, thereby extending the current sequence of growth to 33 months. The upturn in temporary candidate numbers reflected a combination of slower recruitment and higher redundancies, panellists noted. Though substantial, the latest increase was the softest recorded since June and the weakest of all four monitored English regions for the second month in a row.
Slight drop in permanent starting salaries in November
Latest data pointed to a fourth consecutive monthly drop in salaries awarded to new permanent joiners in the North of England. The reduction was only slight, however, with the respective seasonally adjusted index posting just below the crucial 50.0 no-change mark. A number of recruiters noted that companies had scaled back or frozen their pay offers due to a slowdown in hiring activity and improved candidate numbers. The North was the only one of the four monitored English regions to record a dip in starting salaries.
November data highlighted a further reduction in temp pay across the North of England, marking the fifth drop in six months. The rate of decline was the strongest in over five years and solid overall. Temp wages also fell across the Midlands, albeit only slightly, while marginal increases were recorded in the South of England and in the capital.
Commenting on the latest survey results, Phil Murden, Leeds office senior partner at KPMG UK, said: “November brought with it a continued slowdown in the North’s labour market, with permanent placements and temporary billings both falling at the fastest rate in four months. Hiring freezes and cautious decision-making in the run up to the Chancellor’s Autumn Budget kept activity subdued, as billings for short-term staff slipped for the first time since the summer.
“But, as businesses move through the final month of 2025, the data points to a genuine opportunity to plan ahead with more clarity in the New Year. Candidate availability is rising quickly, giving employers access to strong talent that may have been harder to secure earlier in the year. With starting salaries and temp pay pressures easing and businesses reviewing their plans after the Budget, decision-makers can move with momentum and consider strengthening their teams in a more favourable hiring environment.”
Neil Carberry, REC chief executive, said: “Pre-Budget nerves knocked temporary recruitment back just a little across the UK in November after a growing October, but the overall picture was still relatively benign by comparison to the last year. Recruiters in the North report firms were carrying out hiring freezes, with some decisions on hold. Anxiety about the Budget also explains why temp billings fell for the first time in three months in the North of England. With such a late Budget and the Christmas period just around the corner, the key now will be the decisions that employers make for their businesses this coming January.
“We can see signs of the market stabilising in recent months, but the North is lagging the broader UK improvement in pay rates for new jobs. To really get businesses firing, they need confidence. While the Budget was not the horror show of last year, there was little in it to fire the heart of firms. More recently, moves to change the Employment Rights Bill will have landed well, but there is much more to do to get the economy firing. If government’s priority is growth, their report card at the end of 2025 reads ‘Must try harder’.”
