The UK job market showed signs of stabilization in August, with total job postings reaching nearly 1.7 million, marking a 10 percent increase over the past year, according to data from the Recruitment and Employment Confederation (REC). New vacancies amounted to 712,781 during the month, averaging almost 23,000 per day. Regions with the strongest demand for workers included Dumfries and Galloway, Milton Keynes, and Westminster.

Despite this growth, the labour market's overall pace has slowed compared to previous years, with vacancy numbers falling and the weakest private-sector wage growth recorded since 2020. Youth unemployment remains a particular concern, exceeding 16 percent, significantly higher than the average rate of just under 5 percent across all age groups.

The employment situation has also been impacted by policy changes, specifically the adjustment to employers’ national insurance contributions (NICs) introduced by Rachel Reeves. The modifications raised employment costs by altering the rate and threshold for employer NICs, which some industry leaders argue could dampen further job growth. Maxine Bligh, interim chief executive of the REC, urged Andy Burnham to reconsider the lowering of the employer NIC threshold, describing such a reversal as “a big help” to businesses. She emphasized that while the labour market shows resilience, government measures are needed to stimulate it further.

Alongside these employment trends, optimism among medium-sized businesses has increased. A survey conducted by professional services firm BDO revealed that 80 percent of executives from companies with revenues ranging between £10 million and £300 million expressed a greater willingness to invest in the economy over the recent three-month period. This rising confidence aligns with broader private sector indicators.

Companies identified leisure and retail, financial services, and manufacturing as sectors with the highest growth potential. Investment plans are geographically diverse, with half of the respondents aiming to expand operations in London and the southeast, while 42 percent look to the Midlands region for growth opportunities.

Richard Austin, a partner at BDO, highlighted the significance of mid-market firms as key drivers of job creation and revenue growth in the UK economy. He called for policy support to facilitate this expansion, describing it as a “no-brainer” to back these businesses.

Medium-sized companies have also expressed hopes that Chancellor John Healey’s upcoming first budget will focus on improving access to finance and credit for the private sector to sustain and accelerate economic growth.