According to a new study, the UK job market will face increasing challenges by 2025. Over half of professionals plan to seek new jobs, while employers struggle to retain talent because they are unhappy with salaries and benefits.
Morgan McKinley UK, a global talent management company, conducted a study that revealed 56 percent of British professionals plan to actively seek a new position in the next six-month period. In the meantime, 40 percent plan to hire, which highlights a competitive hiring environment.
These findings, which were published in the M organ McKinley Salary Guide highlight a major challenge for employers: attracting talent. In the last six months, 59 per cent of employers reported that they had lost out on top talent due to their uncompetitive benefits and salary packages. The employee satisfaction rate with benefits is low. The same percentage of professionals feel ‘neutral,’ ‘dissatisfied,’ or highly dissatisfied, with their current offering.
Increased salaries for high-demand roles
Despite the strong demand for flexible work arrangements, 45 percent require employees to stay in the office more than three full days per week. Half of UK companies have kept their salary bands static in the second half 2024. This makes it difficult to attract new talent on a market that is still heavily reliant on remuneration.
In 2025, British employers expect to raise salaries for certain roles that are difficult to fill. Professionals remain cautious with only 40% expecting a salary increase this year.
Victoria Walmsley is the managing director of Morgan McKinley UK. She says that businesses need to take a more strategic approach when it comes to hiring and retaining employees. She explains that the UK job market is competitive and employers need to be strategic about their efforts in acquiring talent. Salary, benefits and flexibility of the workplace continue to be important factors in professional decision making.
Talent retention is a challenge
Walmsley warns businesses that if they don’t adapt, they risk losing their skilled employees. “We’re seeing a shift away from outdated hiring practices and incremental salary increases towards more strategic talent-retention initiatives. Job seekers demand greater transparency in salary ranges, clear progression pathways, flexibility and career development. “Employers who embrace these changes are going to have the biggest advantage.”
Walmsley says that while companies are still facing economic, political, and regulatory challenges, the hiring boom following the pandemic has slowed. Businesses that invest in salary disclosure, structured career advancement and flexible working policies are best placed to retain and attract top talent by 2025.
This research included 530 companies and 2,751 professionals who were asked to provide information on hiring intentions, salary expectations, and motivations for changing jobs in 2025.
