Vacancies in the construction sector declined sharply in December, alongside a wider cooling in the UK labour market, according to a closely watched business survey.
Construction saw the third fastest monthly decline in demand for permanent staff among the sectors surveyed by KPMG and the Recruitment and Employment Confederation (REC).
Only IT & Computing and Secretarial/Clerical saw faster declines in demand for permanent members of staff. No sectors saw an increase in demand for permanent staff in December, with engineering recording the shallowest drop.
Demand for temporary workers in the construction sector also saw a sharp decline, according to the survey, with only Executive/Professional seeing a larger month-on-month drop than construction.
The report, compiled by S&P Global, surveyed recruitment consultancies on how demand for staff has changed compared to the previous month.
Across the economy as a whole, the survey recorded the steepest contraction in staff appointments since August, extending the downturn in appointments to 39 months.
The report suggested “weak business confidence and concerns around costs” were to blame.
Jon Holt, UK senior partner at KPMG, said the jobs market was “still signalling caution” at the end of 2025.
“After a long stretch of rising cost pressures and higher global economic uncertainty, many firms continue to pause hiring and are flexing where they can by using temporary staff,” he said.
Neil Carberry, chief executive of the REC, said it was “always difficult” to draw conclusions from jobs data in December but added it was still a reminder of “the pressure employers are under”.
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