Hiring intentions at two-year low, says BDO

BDO’s Employment Index, which measures businesses’ hiring intentions over the next two quarters, fell to a two-year low last month.

The weakening index reflects recently published official figures, with unemployment rising to 8.1% and job vacancies falling back in August. BDO’s index, part of its monthly Business Trends report, recorded a score of 90.7, a 28-month low.  

However, the report also suggests optimism rebounded last month, continuing a pattern of ups and downs in confidence over the last four years.

BDO’s output and optimism indices remain below the 95 mark indicating growth, although the optimism measure, which predicts business performance two quarters ahead, improved 3.4 points to 92.5.

Jeff Jones, partner and head of BDO in Manchester, said: “With tough business conditions becoming further ingrained, there is of course no quick fix to the economy’s ails. However, despite the current slight downturn, we welcome the continued surprising strength of the UK labour market.  

“We would encourage the Government to take advantage of next week’s Conservative Party Conference to champion an innovative and flexible approach to strengthening the labour market, a key driver for economic recovery.”