UK recruiters register sharp rise in jobseekers as employers cut back

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UK recruiters registered a sharp rise in the number of people looking for work last month, according to a survey published on Wednesday, as companies being squeezed by higher interest rates and slowing demand cut their headcount.

The availability of potential staff has been improving for eight months, following a long period in which businesses struggled to hire. But the rate of increase picked up in October, trade body the Recruitment & Employment Confederation and advisory firm KPMG said.

Its seasonally adjusted index measuring the overall availability of permanent and temporary staff rose from to 59.0, from 55.5 in September. Any figure higher than 50 indicates improvement.

Many recruiters attributed the increase to companies making staff redundant or restructuring their workforce, with some people also looking for a new job because they were worried they would be laid off.

Claire Warnes, partner at KPMG UK, said the widening pool of candidates was “good news for recruiters” but reflected “employers who are making more redundancies as they tighten budgets”.

The monthly report, which showed recruiters placing fewer permanent staff and only a marginal rise in temporary billings, will be closely watched by Bank of England policymakers in the absence of official data on the state of the jobs market, the publication of which is on hold at present.

The BoE said last week that it thought unemployment was running slightly higher than its August forecast, but that wages were still rising at a pace that would fuel persistent inflation. This could mean it would need to keep interest rates higher, at the cost of more jobs, to bring inflation sustainably to target.

Jonathan Haskel, a member of the central bank’s Monetary Policy Committee, said on Friday that workers’ bargaining power on wages could have increased. This was in spite of the weak…