Although the outlook for hiring permanent and temporary staff shows signs of improvement, economic headwinds have dampened expectations.
According to the Whitestone Insight JobsOutlook April 2025 report by Whitestone Insight and the Recruitment and Employment Confederation, this is according to their latest JobsOutlook report.
The outlook for the short term, which covers the next three month, has improved by three points, resulting in a net of +9. The outlook for the medium-term, which covers the next four to twelve months, improved by four points, resulting in a net of +9. The short-term outlook for contract and temporary hiring has shifted into positive territory. It increased three points to net +3, with an increase of +5 in April. The outlook for temporary positions improved by five percentage points, to net: +8, boosted by an increase in optimism of 14 percent in April.
This positive trend is good news for recruitment initiatives such as seasonal hiring, and for opportunities for graduates and school leavers to enter the workforce. The prospects for a sustained job comeback are uncertain because of wider economic pressures as well as concerns over new government policies.
Employer confidence is affected by economic headwinds
The net score of employers’ perceptions about the economy dropped significantly from -35 to -12 in the three months leading up to April 2025. The confidence in investment and hiring decisions has also decreased by five points, resulting in a net score of -9. These figures reflect the employers’ concerns about the ongoing inflation of costs, the increase in National Insurance, and the complexity and cost associated with the proposed Employment Rights Bill.
Kate Shoesmith, REC’s Deputy Chief Executive, said that positive signs are accompanied with significant risks. “Firms see both potential and risk. The improvement in hiring intentions suggests a comeback of jobs this year. However, the extent to which the bounce back will occur depends on how much the economic and political pressures on companies ease. It is therefore the Spending Review that will be judged on whether it presents a long-term, clear and optimistic path to growth.
Shoesmith said that the Employment Rights Bill, and the effective use of Apprenticeship funding announced this week would be crucial to maintain the flow of talent into the workplace.
London re-emphasises hiring optimism
London is a major area of optimism according to the survey. The capital’s employers reported an increase of net +3 quarter-on-quarter in their outlook for short-term permanent hires. London’s medium-term hiring outlook also increased, from net : -2 to : +19. London’s short-term hiring outlook improved from net : -3 to net : +13 during the three-month period from February to April. The medium-term hiring outlook also increased from net : -5, to net : +10.
Shoesmith stated that London is often a bellwether of broader hiring trends, and could signal the possibility of a wider economic recovery if the economy stabilizes. The report indicates that a meaningful recovery is dependent on the reduction of regulatory uncertainty and cost pressures currently faced by businesses.
JobsOutlook also found that mid-sized companies, those with 50 to 249 employees, had significantly improved hiring intentions. The report noted that these firms have a positive outlook on both permanent and temp hiring for the short- and medium-term, which is in line with the overall improvement in hiring sentiment.
