Pre-budget uncertainty and global volatility temper city hiring at year end
Key statistics from Morgan McKinley’s 2025 London Employment Monitor:
- 13% decrease in jobs available quarter-on-quarter (Q4 2025 vs Q3 2025)
- 16% increase in jobs available year-on-year (Q4 2025 vs Q4 2024)
- 2025 jobs increased by 12% compared to 2024
The latest employment figures from Morgan McKinley show that job openings across London’s financial services sector fell by 13% quarter-on-quarter in Q4 2025. Despite the slowdown, vacancies were up 16% compared with Q4 2024, with total jobs across 2025 rising 12% year-on-year.
Mark Astbury, director, Morgan McKinley commented: “Hiring across London’s financial services sector softened in the final quarter of 2025 as organisations responded to economic, political and market pressures. While Q4 is traditionally the most conservative hiring period due to seasonality, this slowdown was amplified by global market volatility, US trade tensions and uncertainty ahead of the November budget.
Signals around potential tax and levy increases, prompted many businesses to pause or reassess hiring plans. In London’s internationally connected financial ecosystem, discretionary recruitment was deferred, while critical and strategically important replacement roles continued to be filled.
Despite the quarterly slowdown, the broader picture remains resilient. Financial services vacancies in Q4 were 16% higher year-on-year, while total sector employment rose 12%. That resilience could have been stronger had 2024’s budget taken a more business-supportive approach, particularly around the National Insurance increase, which dampened confidence. London continues to attract talent and investment but growth is increasingly selective and skills-driven.
Demand is concentrated in roles that support transformation and regulatory delivery. Technology, operations and change are being priorities to support critical initiatives in 2026 including capital and liquidity management, automation, operational resilience (including AI governance), regulatory remediation and data reporting. These initiatives are driving demand for specialist skills over volume hiring.
Sector trends underline this shift. Software and computer services now account for over 16% of vacancies, with investment management and banking close behind at 15%. FinTech hiring rose by over 50% year-on-year, while banking, insurance, and accountancy saw strong growth in operations and IT-focused roles. By contrast, insurance claims roles fell 3%, broking dropped 20%, and clerical and administrative positions declined 16%, reflecting the impact of automation, AI adoption and relocation of lower-value functions.”
Astbury concluded: “With unemployment at 5%, inflation at 3.2% and interest rates at 3.75%, conditions point to a measured rebound in early Q1, which typically sees hiring growth of around 16%. However, a return to broad-based recruitment is unlikely, as London’s financial services market becomes more focused, with growth driven by technology, operations, regulatory initiatives and strategic delivery. The pace and scope of this recovery will ultimately depend on rising global tensions, including ongoing uncertainty around US policy, which continue to weigh on business confidence and hiring decisions.”