‘Nervousness’ over Brexit negotiations is hitting employer confidence, REC survey finds

Construction is the sector in which employers are finding it hardest to recruit, according to the Re

Construction is the sector in which employers are finding it hardest to recruit, according to the Recruitment & Employment Confederation. Picture: Steve Adams - Credit: ARCHANT } NORFOLK 2004.

A third of employers have a pessimistic outlook for the UK economy according to new research – prompting warnings over the impact of Brexit.

The survey by the Recruitment & Employment Confederation (REC) found 31% of employers expect the economy to worsen while 28% expect it to improve, moving overall confidence into negative territory.

The net balance of -3% is a significant drop from +6% in the REC's previous JobsOutlook survey in July.

REC chief executive Kevin Green said the drop 'should raise a red flag' as he urged the government to give greater clarity over Brexit.

Labour MP Mary Creagh, a leading supporter of the Open Britain campaign group, added: 'It's clear that Brexit is having a chilling impact on hiring in vital sectors like construction, hospitality and engineering.'

The REC found employers are still looking to hire, with one in five planning to increase permanent headcount in the next three months.

Confidence in making hiring and investment decisions remains positive with a net balance of +10%, but is at its lowest for the past year.

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The survey of 601 employers also shows more employers express concerns about a lack of appropriate candidates for construction jobs than any other area.

'The jobs market continues to do well despite growing uncertainty. However, this drop in employer confidence should raise a red flag,' said Mr Green.

'Businesses are continuing to hire to meet demand, but issues like access to labour, Brexit negotiations and political uncertainty are creating nervousness.'

He said dropping consumer confidence was also putting some businesses on edge, adding: 'The government must do more to create an environment where businesses have clarity.

'That means clearly laying out what Brexit plans look like and how employers can keep recruiting the people they need from the EU.

'The jobs market is in a good place, but employers will only continue to hire and invest if they feel assured about the future.'