Some companies are likely to impose a hiring freeze following Britain’s vote to leave the European Union, with firms likely to postpone decisions or opt for interims.
Experts have warned that recruitment activity in the UK is likely sharply decrease in the immediate aftermath of the referendum vote to leave the European Union.
Key bodies said the uncertainty caused by the decision could hit the economy and put employers into preservation mode, with hiring intentions likely to plunge in the short term as decisions are postponed amid economic turbulence.
Recruitment & Employment Confederation chief executive Kevin Green said he expected a broad contraction in hiring activity.
Green urged the government to help employers while the UK was negotiating its exit from the EU.
“The vote to leave the EU is likely to usher in a challenging period for British business and for the UK labour market in particular,
“Our data showed a slowdown in hiring as we approached the referendum. We expect to see this period of uncertainty continue.”
“During this time, the government needs to do everything possible to help businesses grow and create jobs,” he said. “That involves outlining a timetable of renegotiation to help organisations make informed strategic decisions.
“We call on policymakers to set out the plan for implementing changes to employment regulations such as the Agency Workers Directive and the Working Time Directive.”
Simon Walker, director general of the Institute of Directors, told the BBC’s Today programme: “Business leaders are very, very concerned. Nearly half of them expect the other member states to punish Britain.”
Mr Walker said he did not think those that voted for Brexit realised they were voting “for constitutional and economic chaos”, but he added half his members did think they could keep going.
“There’s no point crying over spilt milk. Over time we must not lose faith in business to recover, but it was always going to be a shock with a loss of jobs and economic growth for quite a long time and it looks as though it will permeate through the whole of British business.”
Mr Walker also told prospective leaders of the Conservative party: “Businesses have a clear message to those who may wish to replace David Cameron as prime minister: during the referendum campaign we were promised an open and outward-looking country after Brexit, now it must be delivered.”
There is already evidence that financial institutions in particular are making immediate restructuring plans, and that agencies specialising in interim staff are expecting a sharp upturn in demand for their services.
Share prices are already plunging at leading banks, and Reuters has reported that JPMorgan had warned staff of the potential relocation of some roles. The bank had earlier said up to 4,000 posts were at risk in the event of Brexit. HSBC had issued a similar caution, and Citi warned that Brexit would lead to a “rebalancing” of its operations.
On Monday, airline Easyjet and estate agent Foxtons both warned of the impact of the vote to leave the EU on their business.
Easyjet said the vote meant “additional economic and consumer uncertainty is likely this summer” and it expected revenues to fall as a result.
London-focused Foxtons said its annual earnings would be “significantly lower” than in 2015 and an expected upturn in the London property market in the second half of the year was “unlikely to materialise”.
But some commentators were keen to play down the more apocalyptic possibilities of Brexit. City of London Corporation policy chairman Mark Boleat said he did not fear a demise of the city’s famous banking sector. “The City of London has thrived as a financial and trading centre for more than a thousand years and will continue to do so,” he insisted. “There will be no mass exit of banks and financial institutions from the Square Mile.”