---
title: "UK Jobs Market Stalls Amid Rising Costs"
publisher: "Stockmark.IT"
author: "Stockmark.IT Website"
published: "2026-01-12T09:08:35+00:00"
modified: "2026-01-12T09:08:35+00:00"
date: 2026-01-12
canonical: "https://stockmark.it/uk-jobs-market-stalls-amid-rising-costs/"
category: "Business"
categories: ["Business", "Jobs and Employment"]
image: "https://i0.wp.com/stockmark.it/wp-content/uploads/stencil.default-2025-02-04T062010.253.jpg?fit=1200%2C800&quality=89&ssl=1"
format: "news"
language: "en-GB"
---

# UK Jobs Market Stalls Amid Rising Costs

**Published:** January 12, 2026
**Author:** Stockmark.IT Website
**Categories:** Business, Jobs and Employment
**Featured image:** ![A group of people gathered for a protest in a city street, holding signs. They are surrounded by historic buildings with trees visible in the background. Some attendees are wearing masks.](https://i0.wp.com/stockmark.it/wp-content/uploads/stencil.default-2025-02-04T062010.253.jpg?fit=1200%2C800&quality=89&ssl=1)

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The UK jobs market has shown signs of stagnation, as recent figures indicate a decline in both permanent and temporary positions. The latest survey, conducted by KPMG and the Recruitment and Employment Confederation, reveals a notable drop in job placements, with December marking a four-month low for permanent staff appointments. The report suggests that uncertainty surrounding the government’s budget announcement is weighing heavily on business confidence.

Unemployment has reached a four-year high of 5.1 per cent, with economists predicting it may rise as high as 5.5 per cent in the coming months. Despite this challenging landscape, the survey indicates that businesses do not foresee significant increases in hiring. Increased payroll costs, driven by the living wage and changes to national insurance thresholds, are contributing to this cautious approach.

Neil Carberry, chief executive of the REC, stated that December’s labour market survey illustrates a further deterioration compared to the preceding month, when the budget was revealed. The data indicates that while job placements fell, the pace of decline has slowed, suggesting that recovery may be on the horizon. However, the speed of permanent employment reduction is the fastest seen since August.

Many firms are expressing concerns regarding future hiring and the overall economic outlook. Carberry notes that to improve hiring prospects, there should be a renewed focus on fostering business confidence and investment. A clear governmental roadmap, covering industrial strategy and pragmatic approaches to the Employment Rights Act, is necessary to encourage firms to expand their workforce.

Despite the challenging context, there are emerging signs of a slower downturn in job placements. Yet, the overall expectation among businesses is still one of caution. The year ahead may require strategic decisions to navigate the complexity of the current economic landscape.

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