UK employer confidence in the economy plummeted as coronavirus spead across the country, driven by a dive in sentiment among small businesses, according to the latest research.
Confidence dropped 22 percentage points between February and March from a net figure of minus one to minus 23, as smaller firms were hit hard by the economic impact of coronavirus.
Meanwhile, confidence in hiring and investment decisions fell by 21 percentage points to net minus five as the pandemic took hold in the UK, according to new data from the Recruitment and Employment Confederation (REC) collected between 2 March and 20 March.
However some employers have continued to hire, looking to bring on staff in the short term. Forecast demand for temporary agency workers has increased from minus two in February to 13 this month as key firms such as supermarkets hired flexible stuff to cope with changing demand as the crisis escalated.
Short-term demand for permanent staff stayed positive at net 17, the research found. However there were big differences between sectors, with demand higher than average for technology workers and drivers, which saw net demand of 25 and 22 respectively
Neil Carberry, chief executive of the REC, said: “It’s no surprise that this global pandemic has caused the UK’s labour market to stall.
“What we should remember is this hasn’t been caused by economic problems – it’s a deliberate choice that we’ve made to protect businesses and our fellow citizens.
“When the storm passes we will bounce back, and quickly.
“It has been great to see the government listen to us and others in taking bold measures to protect workers and businesses – but more needs to be done.
“Employers need access to government support very quickly so staff can be paid without unnecessary hurdles. We must also make sure that flexible workers are not left in the lurch – they are a vital part of the labour market, and must not be forgotten in the government’s support packages.”