Hiring activity in Q2 2025 remained mostly unchanged, according to the latest Quarterly Recruitment Outlook from the British Chambers of Commerce (BCC), as firms grappled with the added cost pressures from the Employer National Insurance (NI) hike.
The BCC’s Insight Unit reported that 55% of businesses sought to recruit between mid-May and early June—a marginal rise from 54% in Q1. Of those attempting to hire, 73% faced difficulties sourcing suitable candidates, showing a slight improvement from the 76% who reported challenges in the previous quarter.
Feedback was gathered after the NI increase took effect, with over 4,500 businesses responding to the report, 93% of them small and medium-sized enterprises (SMEs) operating across the UK.
Hiring challenges were most severe in transport and logistics, with 80% of businesses in that sector reporting difficulties, though slightly down from 82% in Q1. Construction and engineering firms also continued to struggle, with 77% experiencing recruitment issues, a small drop from 83%.
While 60% of businesses maintained the same number of employees in Q2, 23% increased their workforce, up slightly from 20% in the previous quarter. However, future hiring sentiment dipped, with only 25% of firms planning to recruit over the next three months, compared to 27% in Q1.
Labour costs remain the most significant expense for firms, cited by 73% of respondents, unchanged from the previous quarter. These pressures are especially pronounced in transport and logistics (88%) and the hospitality sector (83%).
Despite rising cost pressures, training budgets have seen little movement. Just 23% of firms reported increasing investment in staff training during Q2, while the majority, 59% said spending remained the same.
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