REC response to ONS labour market figures, July 2025

The ONS published its latest labour market figures this morning. The Recruitment and Employment Confederation (REC) Chief Executive Neil Carberry said:

“While the overall levels of employment and unemployment remain reasonably steady, the trend is one of clear weakening across most measures. This reflects businesses’ reactions to rising costs and an uncertain external environment. Many firms are choosing to operate leaner in response to the current situation – we can see that in private sector temporary work outperforming other forms of hiring right now as firms seek flexibility.

“We should not let pessimism take hold – our data shows businesses are confident in their own plans, while households have rebuilt their cash position after the past few years. If Government can increase businesses’ and families’ willingness to spend for the future, we would likely see a positive trend in both the labour market and the wider economy. A reduction in the interest rate next month will help with that, but so will reassuring firms that they don’t face another swingeing tax raid in the Budget, and fixing the impracticalities in the Employment Rights Bill – a piece of legislation that is not yet suited to the modern workplace.

“More people rejoining the workforce will help address labour and skills shortages. The focus should move to ensure businesses have the flexibility and support to tap into a growing talent pool and keep it sustainable.”