Fall in demand for new staff, research suggests

Demand for staff fell last month amid widespread reports of redundancies, according to new research.

Uncertainty about the economic outlook and rising costs continued to affect the jobs market, according to recruiters.

A study by KPMG and the Recruitment and Employment Confederation (REC) found a fall in full time and temporary appointments in December.

Fewer job opportunities drove a further increase in the number of candidates looking for jobs, according to information from 400 recruitment agencies.

They also reported a tentative improvement in pay trends, with wages for temporary positions increasing for the first time in three months.

Jon Holt, group chief executive of KPMG, said: “The jobs market at the end of 2025 was still signalling caution. After a long stretch of rising cost pressures and higher global economic uncertainty, many firms continue to pause hiring and are flexing where they can by using temporary staff.

“As we head into the New Year, this restraint is likely to remain in the near term. Chief execs who have been prioritising increased investment in tech to improve resilience and productivity, will be looking for signs of greater confidence in the wider economy before turning the hiring taps back on.”

Neil Carberry, REC’s chief executive, said: “It’s always difficult to draw conclusions from jobs data in December, but the fact that the market slipped back a little on November is a reminder of the pressure employers are under.”