Despite enduring a turbulent second quarter marked by declining vacancy rates and stagnating demand for permanent roles, the UK labour market may be starting to show early signs of recovery, according to Chesterfield-based Gi Group Holding\u2019s UK country manager, Paulo Canoa.<\/p>\n
Canoa reflected on a quarter of mixed fortunes for the recruitment and staffing sector.<\/p>\n
\u201cQ2 has been a tale of two halves for the recruitment industry, as is often the case when analysing labour market trends,\u201d he explained. \u201cSome segments are beginning to show encouraging movement, while others are clearly still under pressure, with fewer opportunities and limited growth.\u201d<\/p>\n
Recent data from the Office for National Statistics (ONS) supports this uneven picture. The UK employment rate for 16\u201364-year-olds edged up to 75.2%, and total employment topped 34 million. This is a promising signal of workforce engagement. However, the unemployment rate rose to 4.7%, and economic inactivity held firm at a concerning 21%. Perhaps most notably, job vacancies fell for the 36th consecutive month, dipping to 727,000, the lowest level in three years.<\/p>\n
Canoa acknowledged the complexity of the landscape but remains cautiously optimistic.<\/p>\n
\u201cThe UK staffing market is going through an unprecedented and highly complex period,\u201d he said. \u201cStill, our performance in Q2, creating and managing over 21,000 job opportunities, demonstrates our ability to adapt and remain relevant. But let\u2019s be clear: these negative indicators cannot persist if we want a healthy, thriving economy.\u201d<\/p>\n
According to the Recruitment & Employment Confederation (REC), June 2025 saw the sharpest drop in permanent placements in nearly two years. This aligns with employers\u2019 continued cost-consciousness and the impact of recent policy shifts, including the National Minimum Wage increase and higher National Insurance contributions.<\/p>\n
Even so, there are glimmers of hope. REC data also showed improved employer confidence in the economy between April and June.<\/p>\n
Canoa believes that closer collaboration between industry and government is crucial for turning short-term challenges into long-term resilience.<\/p>\n
\u201cNow more than ever, we need strategic conversations between recruitment leaders and policymakers,\u201d he said. \u201cThe focus must be on immediate support for upskilling and retraining workers, especially as automation and AI begin replacing lower-skilled roles. If we get this right, it can be a major driver of recovery.\u201d<\/p>\n
He also pointed to the UK Government\u2019s recently launched Industrial Strategy as a potential turning point. With its emphasis on net-zero goals, digital transformation, life sciences, and advanced manufacturing, the strategy includes commitments to invest in infrastructure and skills. These are both essential for sparking job creation.<\/p>\n
The newly ratified UK\u2013US trade and tariff agreements could further accelerate progress. By enhancing cross-border investment and service sector trade, the deal is expected to drive demand in resilient labour segments such as temporary staffing and specialist roles in technology and logistics.<\/p>\n
As for Gi Group, Canoa says the company remains focused on supporting both clients and candidates in navigating the uncertain terrain.<\/p>\n
\u201cThere\u2019s no denying the market is challenging,\u201d he concluded. \u201cBut we\u2019re starting to see green shoots. There\u2019s a path forward to sustainable growth, but it requires urgent, coordinated action across the board.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Paulo Canoa sees signs of recovery in a struggling UK jobs market and calls for urgent action<\/p>\n","protected":false},"author":25,"featured_media":2100570,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[127684],"coauthors":[95],"class_list":["post-2100569","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-recruitment","tag-derbyshire","tag-top-story"],"yoast_head":"\n