Uncertain UK Labour Market Outlook Post-Budget: What to Expect

The UK labour market is facing uncertainty post-budget, with a drop in job postings this year, according to data from Indeed. Even though the economy showed improvement compared to earlier in the year, there was a 24% decline in job postings. This trend may continue into next year, the recruitment platform warns.

Compared to countries like Australia, Canada, France, Germany, and the US, the UK had the largest decrease in new job listings on the Indeed website. Factors like the upcoming increase in national minimum wage rates, business rates, employer national insurance contributions, and changes in the threshold could make companies more cautious about hiring next year.

A variety of occupational categories in the UK saw a decrease in job postings, with the legal sector being the only one with an increase. Particularly hit were sectors like veterinary, electrical engineering, security, and public safety. Remote work opportunities in technology roles and professional categories were also affected.

Data from the Indeed Wage Tracker showed a slight dip in pay compared to earlier in the year, with a visible wage gap between lower and higher-paid roles. Despite government plans to restrict zero-hours contracts, there was an increase in their mention in job postings, particularly in low-paid sectors like sports, personal care, home health, hospitality, and tourism.

The report also noted greater pay transparency in UK job postings over the past five years, with nearly 72% including some salary information in October compared to less than 50% before the pandemic. Despite a push for employees to return to the office, remote or hybrid work options remain at 14.6%, which is higher than pre-pandemic levels.

Jack Kennedy, a senior economist at Indeed, highlighted that while the UK economy performed better in 2024 than expected, challenges remain in 2025. Employers may have to contend with sluggish job creation, rising employer National Insurance contributions, and a cooling labor market. While candidates may see a shift of power back to employers in negotiations, being competitive on pay and benefits, including flexible and remote work options, remains crucial.