The availability of candidates for jobs has increased at the biggest rate for more than four years, according to recruiters.

A survey by KPMG and the Recruitment and Employment Confederation (REC) pointed to a further reduction in recruitment activity by firms in May.

Permanent placements fell last month and the availability of candidates increased at the quickest rate for nearly four-and-a-half years amid reports of redundancies and fewer job opportunities, said the report, based on data from 400 recruitment agencies.

Jon Holt, group chief executive at KPMG, said: “May’s data shows very little change. Employers are still holding back on hiring, which meant last month the number of jobseekers increased at the steepest rate since 2020.

“The first half of this year has been full of uncertainty for businesses who are still trying to navigate cost pressures, technology advancements and global risks.”

Neil Carberry, REC chief executive, said: “More encouraging signs in temp billings, vacancies and stabilising private sector demand offer a measure of optimism as we head into the second half of the year.

“There are early signs of promise, particularly in the Midlands, which saw its first increase in permanent placements in a year and a rise in billings after four months. Meanwhile, the downturn in temporary billings has eased further in London and the north of England.

“With the industrial strategy imminent, businesses are looking for more than talk of renewal, they want a clear plan for an economic revival.

“One that acknowledges the central role of good workforce policy – beyond just employment rights.”