UK hiring intentions decline for second month in a row as Brexit looms
UK firms intend to hire fewer people for the second month in a row in a sign of Brexit uncertainty weighing on the jobs market, a new study has said.
British companies said they were looking to take on fewer new employees in the six months from February than they were from January, according to the latest business trends figures from British accountancy and business advisory firm BDO.
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BDO’s employment intentions index, in which 100 is the long term average, fell from 115.11 in January to 113.99 in February, marking the second consecutive month of decline in the hiring rate in the UK economy. The figure was 115.24 in December 2018.
The report links these figures to recent announcements by employers such as Nissan, who will not be making their X-Trail model in the UK, and Jaguar Land Rover, who will be cutting 4,500 jobs in Britain, saying they show Brexit uncertainties dragging on the jobs market.
However, in a sign of the labour market strengthening over the last year, the figure for February 2018 was 111.89, 2.1 points lower than February 2019’s score.
The study also revealed that businesses have become less optimistic about the future for the seventh month in a row. BDO’s optimism index fell by 0.19 points in February to 99.79, the lowest the index has been since December 2016.
Manufacturing businesses were the most gloomy, with BDO’s manufacturing optimism index dipping from January’s 104.40 to 103.84 for February.
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BDO partner Peter Hemington said: “The bright spot of Britain’s low-investment, low-growth economy in recent years has been its flexible labour market. This has been Europe’s jobs creation machine, sucking in workers from all over the continent.”
“Unfortunately the uncertainty created by Brexit is bringing this trend to a halt, with hiring intentions sharply down over the last two months”, he said.