The state of the labour market in Q2 2025
UK employers are continuing to kick major hiring decisions into the long grass, with the latest data from the ManpowerGroup Employment Outlook Survey showing 42% of organisations plan no changes to their employee headcount in Q2 (April – June) 2025. An additional 11% don’t know if or how their staffing levels will change. Among employers who are planning headcount changes, average employer hiring volume is down -27% versus Q1 2025.
Michael Stull, Managing Director, ManpowerGroup UK, said: “With less hiring taking place, many employees are understandably reluctant to consider changing roles. Given this, employers must prioritise workforce optimisation and internal mobility. Offering opportunities to upskill and finding ways to keep teams motivated and energised will drive much-needed productivity during this period of stagnation.
“The Government’s vast policy changes announced in the Autumn budget will be coming into effect in Q2. This means the hiring recession we’ve been experiencing looks set to continue until the impact is fully realised by cautious business leaders. As widespread caution continues to stifle decision-making, employers will need to treat the workforce as they would in an economic recession; they must look at driving productivity within their workforce for the rest of the year. Those businesses which are able to work smarter in the next few months will be in a better position for when the wider economy does turn around.
“For the time being, economic uncertainty and cost pressures remain a real issue for many employers as the negative sentiment, alongside flat consumer spending and growing insolvencies all adds to a sense there is only so much more they can do. It’s likely they will continue to hold tight until we’ve seen the full impact of next month’s tax rises. Therefore, we urge those who can, to navigate the uncertainty and find new solutions to drive productivity and efficiencies. They will likely reap the rewards later in the year when it is hoped the market will stabilise and improve.”
Find out more in the Q2 2025 ManpowerGroup Employment Outlook Survey report, including:
Hiring volume changes from small business to large enterprise
Reasons driving employer hiring decisions
Top five hardest to find skills.
