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Labour & Talent Index UK
Labour Talent Index
Introducing the Labour and Talent (LT) Index for the UK Job Market
The LT Index is a comprehensive tool designed to gauge the current health and dynamics of the UK job market, drawing inspiration from the Fear and Greed Index used in financial markets. Just as the Fear and Greed Index provides insights into market sentiment, the LT Index offers valuable insights into the UK's labour and talent landscape.
How It Works
The LT Index is constructed by considering various key factors that influence the job market, assigning each factor a specific weight to create an overall score. Here's a breakdown of the metrics that contribute to the LT Index:
Macro Effects (Weight: 0-16)
This category encompasses factors that impact the broader economy and labour market. It includes elements like the overall state of the UK economy, inflation levels, confidence in the government, occurrences of strikes, mortgage rates, as well as influences such as war and pandemic situations.
Unemployment Rate (Weight: 0-12)
The percentage of the labour force actively seeking employment. A lower rate indicates healthier employment conditions.
Job Vacancies (Weight: 0-12)
The count of unfilled job positions, reflects the demand for labour in the market. A higher number suggests robust labour demand.
Salary Growth Rate (Weight: 0-10)
The annual change in median salaries. A faster growth rate might indicate a competitive labour market.
Temporary Employment Rate (Weight: 0-10)
The proportion of the labour force in temporary positions, reflecting employer uncertainty about the future.
Underemployment Rate (Weight: 0-10)
The percentage of workers in part-time roles or jobs below their qualifications. A higher rate might suggest an imperfectly healthy labour market.
Labour Force Participation Rate (Weight: 0-10)
The percentage of the working-age population employed or actively seeking work. A declining rate could indicate discouragement among job seekers.
Job Switch Rate (Weight: 0-10)
The rate at which employees transition to new jobs. A higher rate signifies a dynamic labour market with better opportunities for workers.
Important Notes:
- Each metric is continuously tracked over time and combined to generate an overall index score.
- The weights assigned to each metric are adjusted based on the specific focus and objectives of the index.
- Constructing the LT Index requires up-to-date labour market data and a method for combining metrics into an overall score.
- Similar to the Fear and Greed Index, the LT Index offers a single number representing the prevailing state of the job market.
- While the LT Index simplifies the job market's complexity, it provides a quick overview of its general condition.
- In summary, the LT Index serves as a valuable tool for businesses, policymakers, and job seekers, offering a simplified yet insightful snapshot of the UK's labour and talent landscape.
| Item | Value |
| January 2026 | 65 |
|
December 2025 |
31 |
|
January 2025 |
68 |
| Last updated | 14th January 2026 |
| Hiring has gained significant momentum as we start the new year. While some businesses were cautious previously, many are now accelerating recruitment drives as confidence returns to the wider economic landscape. Decisions regarding budgets and expansion are increasingly positive following recent interest rate stabilisations. Starting salaries are beginning to climb again as firms compete for top talent, though efficiency remains a key priority. Recruiters report that candidates are feeling much more optimistic and ready to move. | |
| Thought: | Roll on 2026!! |