Employers’ confidence in the prospects for the UK economy declined further in September, according to the Recruitment and Employment Confederation’s latest JobsOutlook report.

The report found that the balance of those seeing a positive outlook as opposed to a negative one was a net -5, a decrease of 4 points from August 2018 and the lowest since March 2018.

Despite the lowest confidence in the prospects for the economy for six months, employers’ confidence in making hiring and investment decisions in their own businesses remained in positive territory with a net balance of +15, the same as the previous month.

Neil Carberry, Recruitment & Employment Confederation Chief Executive, commented “The further weakening of employer confidence is a reminder that time is running out on our negotiations with the EU. UK business will need to adapt to whatever deal is done, and employers are making contingency plans for what a deal or no deal scenario may bring.

“The report’s remarkably robust findings on hiring show that firms are still ready to invest in their own business where they see customer demand. Recruiters are working hard to fill job vacancies and aid future growth,” Carberry said.

Meanwhile, 50% of employers who hire permanent staff expressed their concern this quarter over the sufficient availability of candidates for permanent jobs, with anticipated shortages of engineering and technical workers causing most anxiety for employers. Health and social care workers and construction professionals were the other two professions where employers expect severest skills shortages.

More than half, or 60%, of employers intending to hire temporary workers expressed concerns over the sufficient number of agency workers with the necessary skills they require, up from 36% this time last year with employers expecting the most severest skills shortages in the marketing, media & creative sector, followed by drivers and construction sectors.

The net balance of employers intending to hire agency staff in the short-term rose by 23% compared to this time last year. The net balance of those intending to hire temporary agency workers in the medium-term rose to +19 percentage points from +7 points in September 2017.

“Employment is high and candidate availability tight,” Carberry said. “The coming months will show whether the plans to increase use of temporary staff we see today reflect the need for staff in a tight labour market, or weakening employer confidence in the economy for 2019.”