Jobs drought deepens as redundancies rise and vacancies fall for the 34th month in a row

See more This is Money on Google - save us as a Preferred Source Updated: 02:59 EDT, 7 September 2026 Work vacancies have fallen for the 34th month in a row as Britain’s jobs drought deepens.Employers are ‘keeping the brakes’ on hiring as the continued uncertainty posed by the Iran war and higher borrowing costs take their toll, new figures showed.And the number of people seeking work is on the rise as workers are made redundant.The findings in a monthly survey by the Recruitment and Employment Confederation (REC) and accountancy firm KPMG echo recent official figures showing that job opportunities are shrinking.Many firms blame Labour’s hike in employer national insurance and steep rises in the minimum wage for making it costlier to hire. They are also anxious about the impact of a raft of new workers’ rights rules.At the same time, high energy prices caused by the war are biting and interest rate hike fears loom. Redundancies are rising as employers hold back on hiring in the face of higher costs The REC-KPMG survey of recruitment consultancies said the number of people seeking new employment rose at the sharpest rate for three months in August with redundancies ‘a prominent theme’ behind the trend.Recruiters also pointed to ‘fewer job opportunities and concerns over current job security’.The report added: ‘Overall demand for staff fell for the thirty-fourth month in a row in August.‘Permanent vacancies fell at a solid pace that was unchanged from July, while demand for short-term staff fell following a brief rise in the previous month.’However, there were some signs of a turnaround in sentiment as permanent placements rose slightly – for the first time in four years.KPMG boss Jon Holt said: ‘The jobs market continues to contract overall.‘Vacancies are still falling, the number of people looking for work continues to rise, and some employers are keeping the brakes on recruitment because of continued geopolitical uncertainty and elevated borrowing costs.‘With the Budget next month, the Government has the opportunity to turn these green shoots into sustained positive momentum.‘A clear and credible plan for growth would give businesses greater certainty over the outlook and help unlock stronger demand across the jobs market.’Maxine Bligh, interim chief executive at the REC, said: ‘This is not the time to take the job market for granted. Instead, government should follow through on its commitment to lessen burdens on business.’Ms Bligh said that should mean ‘greater pragmatism on the employment rights agenda’ including ‘the gamble the government is taking with its guaranteed hours policy’.Business groups argue the policy – which promises contracts to casual workers based on their recent working hours – will deter employers from hiring temporary seasonal staff during busy periods such as Christmas.DIY INVESTING PLATFORMSAJ BellAJ BellEasy investing and ready-made portfoliosHargreaves LansdownHargreaves LansdownFree fund dealing and investment ideasinteractive investorinteractive investorFlat-fee investing from £4.99 per monthFreetradeFreetradeInvesting Isa now free on basic planTrading 212Trading 212Free share dealing and no account feeAffiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.Compare the best investing account for you