Employer confidence in the UK economy fell to its lowest level since mid-2016, according to the Recruitment & Employment Confederation’s “JobsOutlook” report released today. It covers the three months from August to October.

The report found that 51% of business believe economic conditions in the UK are getting worse while only 17% believe they are improving. Subtracting the percentage of respondents saying conditions are getting worse from the percentage saying they are getting better results in a barometer reading of -34, a decline of three percentage points from the survey in the three-month period ended in September.

However, hiring intentions remained stable for both the short term and medium term.

REC Chief Executive Neil Carberry said the JobsOulook report shows a great deal of potential in British businesses, but uncertainty is a stumbling block.

“An incoming government should prioritise work by ensuring the two-way flexibility of the labour market is protected, allowing employers to recruit the staff they need while also protecting workers,” Carberry said. “This is the last set of JobsOutlook data before the general election, and we are urging all parties to think hard about how their policies will impact companies and their workers.”

Other findings in the report:

• 75% of employers had little or no surplus capacity in their workforce. For the largest firms in the UK, those with 250 or more employees, 84% had little or no surplus capacity.
• 50% of employers of permanent staff reported they were concerned about shortages of candidates for hire.
• 70% of employers increased pay/earnings in the year to August-October 2019. This compared to 57% in the same period a year ago.
• 90% of employers who use recruitment agencies highlighted an agency’s regional or sectoral experience as an important factor when choosing their recruitment partners.

The JobsOutlook report is based on telephone interviews with 600 UK employers.