Each month, we share the latest labour market trends based on the ‘UK Report on Jobs’ from KPMG and the Recruitment and Employment Confederation (REC), alongside insights from our teams across the regions.
The report is compiled by S&G Global, based on a monthly questionnaire sent to a panel of approximately 400 UK recruitment and employment agencies – including ourselves. This report is based on the figures collected the previous month.
Key Points
Temporary billings increased at the fastest rate since April 2023
Permanent recruitment shows signs of stabilising
Candidate availability remains high
Pay growth strengthens
Temporary billings increased at the fastest rate since April 2023
Businesses are increasingly favouring flexible staffing solutions in response to ongoing economic uncertainty. Temporary billings increased at the fastest rate since April 2023, reflecting employers' preference for short-term resource over long-term hiring commitments.
This trend highlights that many organisations still have work to deliver but remain hesitant to expand their permanent workforce until market conditions become more predictable.
Permanent recruitment shows signs of stabilising
Although permanent placements fell again in June, the decline was only marginal and represented the softest reduction in the past three months. This suggests employer confidence may be beginning to improve after a challenging first half of the year. Recruitment remains cautious, with many businesses continuing to review budgets and delay permanent hiring decisions while monitoring economic conditions.
Candidate availability remains high
The supply of candidates continued to increase during June, driven largely by ongoing redundancies and reduced recruitment activity. However, the rate of growth in candidate availability slowed compared with previous months, with some professionals choosing to remain in their current roles rather than seek new opportunities. For employers, this means there is still a healthy talent pool available, although attracting specialist skills continues to require competitive offers.
Pay growth strengthens
Despite softer hiring demand, starting salaries and temporary pay rates both increased at their fastest pace since January. This reflects continued competition for candidates with in-demand skills, demonstrating that while overall recruitment volumes remain subdued, businesses are still prepared to offer higher pay to secure the right talent.
Neil Carberry, REC Chief Executive, said:
“After a long recruitment winter, these figures show truly hopeful signs. Temporary and contract work once again leads the way, as firms react to demand without yet feeling confident enough to commit to larger scale permanent hiring. Though that too looks like it may change. With a new Prime Minister coming, there is a clear message here from business. The potential for the growth the country needs is here – but not if the Government pours more uncertainty and cost onto the private sector. It’s time to back business and work in partnership, not hand down costs and regulation from on high. That’s what contributed to unworkable proposals on guaranteed hours and a National Insurance bill that has driven youth unemployment up. It’s time to change that.”
SUMMARY
June's figures suggest the labour market is becoming more stable, even if confidence has yet to fully return. Employers continue to favour temporary recruitment to maintain flexibility, while permanent hiring is showing early signs of recovery after several challenging months.
For candidates, opportunities remain strongest within temporary and specialist sectors, while employers should be prepared to act quickly and offer competitive packages when recruiting for hard-to-fill roles.
Overall, the market remains cautious rather than contracting, with many businesses waiting for greater economic certainty before committing to long-term hiring decisions.