UK Job Vacancies Fall Again as Labour Market Shows Signs of Cooling

Vacancies for jobs in Britain continued to decline in December, reinforcing growing evidence that the UK labour market is cooling after several years of tight conditions. According to the latest survey from online jobs portal Adzuna, the number of advertised roles fell to 716,791 in December, down from 745,448 in November. This represents a 15% year-on-year decline and marks the weakest full-year performance for job vacancies since 2020, when the COVID-19 pandemic severely disrupted hiring activity.

December marked the sixth consecutive month of falling vacancies, suggesting that hiring momentum is slowing across the UK economy. Adzuna noted that competition for roles has intensified as employers reduced recruitment plans, with the usual year-end uplift in hiring failing to materialise. Many of the UK’s largest sectors experienced slower hiring, adding to concerns about a deteriorating jobs market despite tentative signs of improving economic activity among businesses and consumers.

While overall hiring remained subdued, there were early indications of recovery in graduate and entry-level roles. Adzuna co-founder Andrew Hunter described these developments as potential “green shoots” for the year ahead, offering some optimism for younger workers and new labour market entrants.

Wage growth also showed signs of easing. Adzuna’s survey revealed that average advertised salaries were 6.8% higher than a year earlier, down from a 7.7% annual increase recorded in November. This moderation in pay growth is being closely monitored by Bank of England policymakers, who are assessing labour market conditions and wage pressures as part of their decisions on interest rates and inflation control. Slowing wage growth could reduce inflationary pressures but may also limit the scope for repeated interest rate cuts in 2026.

Additional data from the Confederation of British Industry (CBI) painted a similar picture of cautious optimism. The CBI’s growth indicator for the next three months improved to -20 from -30 in December, while its measure of activity over the past three months remained deeply negative. According to the CBI, businesses continue to face fragile confidence, cautious spending, and households that are increasingly downtrading, underscoring ongoing uncertainty in the UK economy.