CIPD Labour Market Outlook for Spring 2025: Analysis by Lewis Silkin

The most recent CIPD Labour Market Outlook report indicates a decline in employer confidence this quarter, highlighting a significant drop in the net employment balance, reaching a level not seen since before the pandemic. The report also reveals that hiring intentions have weakened, with approximately one in four employers now considering redundancies, particularly in the private sector where the figure rises to 27%.

A key factor contributing to this trend is the escalating costs associated with employment, including adjustments to National Insurance contributions and the National Living Wage. These increased expenses are prompting many organizations to reassess their recruitment strategies, reduce investment in training programs, and contemplate implementing price hikes to offset the financial burden.

Moreover, the uncertain landscape surrounding the Employment Rights Bill and global events is compounding employers’ apprehension, further dampening their willingness to undertake new hiring initiatives. This heightened sense of caution is reflected in the survey results, which indicate a prevailing sense of unease among businesses regarding the future economic outlook and regulatory framework governing the labor market.

The findings of the report underscore the pressing challenges faced by employers in navigating a complex and evolving business landscape shaped by economic, political, and regulatory uncertainties. As the global workforce continues to navigate the fallout from the COVID-19 pandemic and grapple with ongoing disruptions, businesses are being forced to adapt their strategies to address the shifting demands of the market and the evolving needs of their workforce.

In conclusion, the latest CIPD Labour Market Outlook report provides valuable insights into the current state of the job market, highlighting the concerns and constraints faced by employers as they strive to maintain operational stability and navigate the challenges of a rapidly changing business environment. By shedding light on the factors influencing employer confidence and hiring decisions, the report offers a comprehensive perspective on the dynamics shaping the labor market and the implications for businesses and workers alike.