Why Did London Financial Services Hiring Slow At The End Of 2025?

Hiring activity in London’s financial services market went down during the final quarter of 2025. Data from Morgan McKinley’s 2025 London Employment Monitor shows jobs available fell 13% in Q4 compared with Q3. Recruiters said late year caution played a clear role in the slowdown.

Mark Astbury, director at Morgan McKinley, said economic and political pressure shaped employer behaviour during the period. Global market volatility, tension linked to US trade policy and uncertainty ahead of the November budget led many organisations to pause recruitment decisions.

Astbury said Q4 often records lower hiring levels due to seasonal behaviour. During 2025 this effect deepened as employers reacted to possible tax and levy increases. Many businesses chose to delay non essential recruitment rather than commit to new hires.

London’s close ties to international markets also fed into this trend. Astbury said companies postponed discretionary hiring, though replacement posts tied to business continuity continued to come up. This created uneven recruitment activity during the quarter.

What Do The Full Year Numbers Say About Financial Services Jobs In 2025?

The annual data shows a more positive direction. Morgan McKinley said total financial services jobs in 2025 came up 12% compared with 2024. Vacancies recorded in Q4 also was at 16% higher than the same quarter a year earlier.

Astbury described the yearly results as resilient. He said growth could have been higher if the 2024 budget had taken a more business friendly tone. The National Insurance increase weighed on confidence throughout much of the year, according to Morgan McKinley.

London continued to attract skilled workers and investment during 2025. Recruitment activity leaned toward targeted hiring rather than volume hiring, reflecting employer caution mixed with ongoing demand for specialist skills.

Morgan McKinley said this trend defined much of the year. Companies added staff where technical knowledge matched long term business needs, while many traditional roles saw fewer openings.

Which Jobs And Skills Attracted Employers As 2026 Comes Into View?

Demand was based on technology, operations and regulatory delivery posts. Astbury said these jobs support projects scheduled for 2026, such as capital and liquidity management, automation, operational resilience including AI governance, regulatory remediation and data reporting.

Morgan McKinley figures show software and computer services accounted for over 16% of vacancies during 2025. Investment management and banking followed closely, each representing 15% of advertised roles. FinTech recruitment came up more than 50% year on year.

Other job types moved in the opposite direction. Insurance claims positions went down 3%. Broking roles went down 20%. Clerical and administrative jobs dropped 16%. Morgan McKinley linked these changes to automation, AI use and the relocation of lower value work.

Astbury said unemployment was at 5%, inflation measured 3.2% and interest rates sat at 3.75%. These conditions point toward a measured improvement early in Q1, which usually records hiring growth of around 16%.

He said a return to large scale recruitment looks unlikely. Hiring decisions now lean toward technology, operations and regulatory delivery. Uncertainty tied to global politics, including US policy, continues to influence employer confidence and recruitment choices.

The pace of hiring during the first months of 2026 will depend on economic signals and policy clarity, with businesses watching developments closely before committing to new staff.