Permanent pay actually increased last month due to the demand for highly skilled workers, but the number of placements has been in a steady decline since October.

Recruitment firms have also reported an increase in redundancies according to the most recent KPMG and REC UK Report on Jobs, stating that the stark drop in levels of recruitment in December declined at its fastest rate since August 2023, with the lowest number of people hired since August 2020.

Respondents to the survey cited October’s tax raiding Budget as a primary contributing factor.

John Holt, group chief executive a KPMG said: ‘As we start the new year, it’s a muted one for the UK jobs market. December’s data shows weakening demand causing the biggest contraction in vacancies since August 2020, coupled with hiring intention declining at a pace not seen for 16 months.’

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