Employer Confidence Shows Signs of Recovery – What It Means for Hiring in 2025

After a year of economic turbulence, new data from the REC and Whitestone Insight offers employers a cautious reason for optimism.

The latest JobsOutlook survey, covering over 700 UK employers, reveals that confidence among businesses may finally be turning a corner – with hiring intentions and investment sentiment both improving in the second quarter of 2025.

Signs of Stability After a Volatile Year

Over the past 12 months, UK employers have been navigating an extremely challenging landscape:

• Stubbornly low economic growth

• Rising tax and employment costs

• Disruption in energy, supply chains, and international trade

• Uncertainty surrounding the incoming Employment Rights Bill

Despite this, the newest JobsOutlook data suggests that the Spring downturn might have been a temporary dip in what is otherwise a slow but steady recovery.

Confidence in the UK economy rose by 15 percentage points compared to the previous quarter – though still in negative territory at net -20, it marks a significant improvement. More importantly, employers’ confidence in their ability to make hiring and investment decisions has swung back into positive ground, increasing to net +3 (up from net -9).

What This Means for Hiring

This renewed confidence is starting to translate into action. Employers are expressing stronger intent to hire across all forms of labour supply, which we are also seeing firsthand from our clients:

• Short-term permanent hiring intentions are up three points to net +13

• Medium-term permanent outlook (over 4–12 months) rose by six points to net +15

• Short-term temporary hiring jumped eight points to net +12

• Medium-term temporary/contract hiring also rose by eight points

London remains a standout region, leading the way in both permanent and temporary hiring projections. Larger businesses (those with over 250 staff) also show significantly stronger hiring confidence – a promising signal for market momentum in the second half of the year.

What Industry Leaders Are Saying

Neil Carberry, Chief Executive of the REC, summed it up well:

“Confidence is the key to growth in 2025. Despite the Spring battering from rising policy costs, businesses are starting to move forward. Unlocking investment is critical – turning cautious employers into active hirers.”

He also emphasised the role of government in maintaining this fragile recovery. The upcoming Budget must balance public finance needs with robust support for business growth. A stable political environment, positive developments in trade, and manageable inflation are all contributing factors in employers’ improving outlook.

Why This Matters for Your Business

At Cubed Talent, we see these shifts firsthand. As confidence grows, businesses will begin to re-engage their hiring plans – and competition for top talent will intensify.

Understanding the labour market landscape helps you stay one step ahead. Whether you're scaling operations or building talent pipelines, now is the time to prepare for a more active jobs market.

Key takeaways for employers:

• Recruitment confidence is returning, especially among large employers

• Temporary and permanent hiring intentions are rising

• Government decisions this Autumn will be critical to sustaining momentum

We’ll continue to monitor the market and provide our clients with insights and tailored recruitment strategies to adapt to the changing environment.

Need help navigating these shifts?

Talk to our expert team at Cubed Talent – we’re here to help you find and retain the people who’ll drive your business forward.