Job vacancies and appointments have plunged to the lowest level for at least 11 years.
A report by the Recruitment and Employment Confederation (REC) and financial services firm KPMG found permanent and temporary staff appointments are at their weakest level since the start of the survey in October 1997.
The permanent placements index slumped to 33.2 from September’s level of 41.2, and temporary placements slid 45.3 to 38.6 over the same period, where 50 represents no change from the previous month.
Pay rates have also fallen for the first time in five years, dropping to 45.7 from 50.0 for permanent employees, according to the salaries index.
Mike Stevens, the head of business Services for KPMG, said job losses would affect most business sectors.
“As UK companies are increasingly under pressure and economic conditions are getting worse, many employers won’t have any choice than making large-scale redundancies,” Stevens said.
“The terrible news from the equity markets and the broader economic front have led to a steep fall in the demand for permanent and temporary jobs across most sectors of the economy and the worst is probably yet to come.”
Kevin Green, REC chief executive, called on the government not to remove the agency worker VAT concession in April as planned, and to push back the implementation of the Agency Workers Directive until the economy has started to recover.
“The prime minister recently said that the flexible labour market is the best way for us to protect jobs and so we expect the government not to add to employers’ costs when taking on temporary workers,” Green said.