The number of job vacancies fell by 31,000 to 818,000 in the September-to-November period, according to the latest figures from the ONS.

Total estimated vacancies were down by 136,000 (14.3%) in September to November 2024 from the level of a year ago; however, they remained 22,000 (2.8%) above their pre-Covid-19 pandemic January to March 2020 levels.

Businesses have argued that the increase in National Insurance Contributions for employers that was announced in the latest Budget will hit jobs.

The Recruitment & Employment Confederation (REC) CEO Neil Carberry said: “Today’s labour market statistics show that there is still much to do to address business concerns about the direction of travel. Across the year, firms have been communicating confidence about their own firms but worries about the outlook. 

“These firms want to drive growth, but for now are feeling the impacts of the increase in Employers National Insurance and are worried about the undercooked Employment Rights Bill. Today’s figures show a 1.5% increase in the number of temporary employees – a confirmation again of how much businesses and workers need flexibility especially when the economy is uncertain.”

Novo Constare, CEO and co-founder of temp staffing platform Indeed Flex, said: “The UK labour market showed further signs of a potential slowdown in Budget month, underscoring the immediate fallout from the Chancellor’s tax announcements.

“Job vacancies have continued to decline, while the number of unemployed people per vacancy has also seen a small increase, as businesses adjust to rising costs and economic uncertainty. Both businesses and households have adopted a more cautious stance, with concerns about tax hikes shaping their decisions even before the Budget was announced.

“As these policies take effect, a more restrained approach to pay, hiring and investment is likely to dominate – reflecting the cloudy outlook for the UK economy.

“Looking ahead to 2025, we may see employers shifting to more flexible workforce solutions that balance the need for greater cost control with operational needs. Businesses will need to adapt and find creative ways to navigate these economic and policy changes, but doing so could help build a stronger and more agile job market in the years to come.”

Ben Keighley, co-founder of AI recruitment platform Gaia, commented that “the progress outlined in the latest labour market transformation report reflects significant strides towards improving the accuracy and quality of employment data”.

He continued: “At the same time, businesses must focus on overcoming the broader challenge of attracting high-quality talent rather than simply managing large volumes of applications, many of which may be irrelevant. 

“Looking ahead, the focus on innovation, collaboration and thorough testing is promising. Delivering reliable insights will be vital to giving businesses, policymakers and economists the clarity needed to foster sustainable growth in a changing economy.”

However, Michael Stull, director at ManpowerGroup UK, gave a more gloomy outlook: “We’re continuing to see signs of a hiring recession driven by economic uncertainty and a lack of confidence in the direction of the UK labour market, as well as the added financial burden placed on employers in the recent Budget. 

“The unreliability of the UK’s Labour Force Survey also means we can’t be fully confident in how the Bank of England is going to respond with its interest rates each month. All of this brings a tangible lack of clarity for businesses that are already hesitant in making hiring decisions for the New Year. It’s also not great for the UK market from an investment standpoint as it will extend the period of slow growth and without action, could potentially lead to a fast approach recession.

“To fire up some much-needed confidence across UK Plc, businesses need a speedy resolution to the ONS survey changes. The prospect of waiting until 2027 to be fully confident in the data isn’t good enough for economic growth to return in 2025. In the meantime we urge businesses to continue investing in skills as a fundamental area to increase productivity in our economy as it bounces back. Our latest survey showed one in three British workers have recently told us they don’t feel they have sufficient opportunities to achieve their career goals. Now is the time to act on this feedback so that further problems aren’t stored up for employers in the New Year.”

• Comment below on this story. Or let us know what you think by emailing us at [email protected] or tweet us to tell us your thoughts or share this story with a friend.