SMEs will feel the ‘impact of the governments’ Employment Rights Bill – London Business News | London Wallet

While there are reports of falling recruitment across the UK, pockets of optimism remain, particularly in highly skilled markets that have long struggled with talent shortages.

That’s according to the latest data from the Association of Professional Staffing Companies (APSCo).

In its latest Hiring Trends analysis – produced in conjunction with Bullhorn – APSCo reported a 17% increase in contract roles between November 2024 and January 2025 (excluding December’s seasonal lull).

These figures also represent a 24% uptick in contractor vacancies between January 2025 and January 2024.

While permanent recruitment remains impacted by the current economic uncertainty, the data does show some signs of optimism.

The number of new permanent roles added between November 2024 and January 2025 rose 19%.

Moya Rylands, Commercial Director at APSCo said,  “We are likely to see the impact of the Government’s Employment Rights Bill and NICs increases continue to play out throughout this year, however, we are seeing some positive signs within the highly skilled, professional recruitment market.

“It may take some time before this becomes sustained growth, but for now it is a promising emblem for the employment landscape.

“It does, however, suggest that skills shortages continue to plague many businesses. Given the sectors APSCo’s data represents, it is highly likely that much of this demand is being driven by employers responding to resourcing gaps, rather than expanding their headcount ahead of the April roll out of the rise in NICs.”

Joseph Buckley, Manager, Business Analytics, Bullhorn, added, “Recruitment activity saw its usual January surge, with promising signs from contract jobs in particular which reached a 20-month high, and permanent vacancies also rebounding from the year-end slowdown.

“Recruiters proved eager to tackle this bounty head-on, boosting month over month job coverage with a flurry of CV sends to match new client demand. Naturally there was an increase in placements and sales (still down year over year) so whilst the activity data is encouraging, it’s unclear if this signals a sustained boost.

“If momentum continues and commitment to hire backs up the deluge of new vacancies, then 2025 could be a year of stabilisation if not growth; the next few months will be key.”