British firms delay permanent hires as Brexit deadline nears
UK-based companies have held back on hiring new permanent hires in February, with employers growing concerned about the fallout of Brexit as the March 29 deadline nears, according to a recent survey of recruiters.
British companies delayed hiring new permanent staff members in February, according to a survey of recruiters published on Friday, signalling that UK firms are happier to wait until after Brexit before investing in new hires.
The survey, which was compiled by the Recruitment and Employment Confederation (REC) alongside accountancy firm KPMG, showed that permanent placements stayed unchanged last month, while temporary hires grew at a faster pace.
‘While numbers are clearly weaker than we have seen over the past few years, the survey suggests businesses are ready to create jobs if the investment environment is right,’ REC CEO Neil Carberry said. ‘As we draw closer to Brexit day, uncertainty and concern has grown, putting the sustainability of positive jobs news at risk.’
‘Firms are looking for politicians to find a solution to the current deadlock that gives them the certainty they need to invest and create jobs,’ he added.
Permanent jobs index hits second-weakest levels since Brexit referendum
The permanent jobs index of the survey edged up to 50.0, the mid-point between rising or falling employee levels in February – the second-weakest since those seen in the wake of the Brexit referendum in June 2016.
The reluctance by British companies to pull the trigger on new permanent hires compared to strong growth in this area seen last year and in 2017, shows how the ongoing uncertainty surrounding Brexit is impacting British businesses investment decisions.
‘Overall, the labour market has been incredibly resilient over the last couple of years as employers have opted to hire more permanent and temporary staff rather than invest in long term productivity gains,’ KPMG vice chair James Stewart said.
‘With a decision on Brexit now imminent we’re seeing companies freeze or slow the pace of new hires, whilst at the same time the number of people looking to enter the jobs market has declined further.’
Stewart concluded on a positive note, adding that once a political decision on Brexit is finally made, he expects to see a ‘wave of pent-up investment to be released’ helping to drive permanent hires in 2019.
See an opportunity to trade?
Go long or short on more than 16,000 markets with IG.
Trade CFDs on our award-winning platform, with low spreads on indices, shares, commodities and more.
Live prices on most popular markets