Temporary staff billings at UK recruitment agencies rose at their fastest rate since April 2023 in June — the second consecutive month of the strongest temp growth in more than three years — while permanent placements fell at only a marginal pace, the softest decline in three months [1][2]. That is the July print of the KPMG/REC Report on Jobs, published on 8 July, and it is the sharpest picture yet of how British employers are actually behaving this year.
Set it beside the CIPD's spring survey of more than 2,000 employers, in which 63% plan to recruit but cost management is the top strategic priority for 58% [4][5], and the Bank of England's July field intelligence, which finds employment intentions broadly flat and recruitment difficulties a little below normal levels [7], and the three most credible reads on UK hiring converge on a single behaviour. Employers have not stopped hiring in 2026. They are hiring carefully, cheaply and reversibly.
Why are employers hiring temps instead of permanent staff?
The Report on Jobs is compiled from a panel of around 400 UK recruitment consultancies; June's data was collected between 11 and 24 June [1]. Its two headline series moved in opposite directions. Billings for temporary and contract staff grew at the quickest rate since April 2023, while permanent placements — which in May had fallen at their fastest pace since July 2025 — declined only marginally [1][2][3]. That May-to-June swing reads as a genuine inflection rather than noise: the permanent series went from its worst reading in ten months to its mildest fall in three months within a single survey round [2][3].
Recruiters on the panel attribute the pattern to subdued business confidence: employers who need output now are buying it through short-term staff and project work rather than permanent headcount [1]. The vacancy detail points the same way. Overall vacancies on the survey fell at their quickest rate since January, but the drop was concentrated in permanent roles, with temporary vacancies easing only marginally [2]. Just two sectors — nursing, medical and care, and engineering — recorded improved demand for permanent staff [2]. In May, the North of England was the only region to record any rise in permanent placements at all [3].
Two further readings matter for anyone planning an autumn hire. Starting-salary growth picked up to its strongest since January, yet remains below the survey's long-run average — a series that runs back to October 1997 [2]. And candidate availability is still rising sharply, driven by redundancies and reduced hiring, although June's increase was the least pronounced in four months [1]. More available candidates and restrained salary pressure are the ingredients of an employer's market, even one this hesitant.
REC chief executive Neil Carberry's verdict on the June figures: "After a long recruitment winter, these figures show truly hopeful signs" [1].
The temp-first shape is the textbook early-cycle pattern — firms flex up with contract staff before committing to permanent payroll. Whether June marks the bottom or merely a pause cannot be known from one print. The next, covering July, lands in early August.
What is the CIPD Labour Market Outlook actually showing?
At first glance the CIPD's Spring Labour Market Outlook, published on 18 May from a survey of more than 2,000 employers, reads more warmly: 63% plan to recruit in the next three months, up from 60% the previous quarter [5]. The detail removes the gloss. The rise was driven almost entirely by the public sector, where hiring intentions jumped from 70% to 77%; the net employment balance — hiring intentions minus expected reductions — sat at just +10, which the CIPD describes as near a record low; and 22% of employers plan redundancies over the same window, rising to 26% in the public sector [4][5].
The apparent contradiction — most employers recruiting while employment barely grows — resolves as churn. Our reading of the data, and it is analysis rather than a CIPD finding: employers are replacing leavers rather than adding heads, which keeps recruitment activity high while net job creation hovers near zero.
Where the CIPD is unambiguous is on what now governs those decisions. Cost management is the highest strategic priority for 58% of organisations — 61% among large businesses — ranking ahead of improving productivity (44%) and growing market share (35%), which the CIPD links to sustained increases in labour, energy and operating costs [4]. Median expected pay awards have been pinned at 3% for eight consecutive quarters [4]. Demand for advertised hiring is thinning too: job postings fell 7.7% in April against March, and were 5.6% below April 2025 [5].
One further figure deserves mention with a health warning attached. Coverage of the CIPD's winter 2025/26 tracking put the share of employers expecting to hire fewer permanent workers because of Employment Rights Act reforms at roughly two in five — a figure reported by People Management that we have not been able to verify at primary source [6]. If accurate, it gives the temp-first turn a policy driver on top of the economic one.
What does the Bank of England hear from employers directly?
The Bank's Agents — regional staff who interview businesses continuously — published their July summary on 24 July, drawing on conversations in the six weeks to the end of June. Their read: employment intentions are broadly flat for the next twelve months, and recruitment difficulties have eased to a little below normal levels. Where jobs are going, they are going mostly through natural attrition in consumer services and parts of manufacturing, offset by targeted recruitment in professional services and IT and digital [7].
On pay, the Agents' weighted average settlement for 2026 is unchanged at 3.5%, lower than 2025 — but with a wildcard attached. Asked what CPI inflation above 3% at year-end would mean, most contacts expected 2027 settlements to come in up to a percentage point higher than planned [7].
The July summary also carries official evidence that AI is changing the shape of hiring, not just its volume. Several professional services contacts report reduced graduate recruitment and lower demand for administrative and junior staff as automation absorbs tasks such as document preparation and basic analysis; the Bank's outreach work adds that more experienced workers are now applying for junior roles, increasing the competition facing younger candidates [7].
How do the three surveys compare?
| Source | Published | What it measures | Headline signal | What it implies about employers |
|---|---|---|---|---|
| KPMG/REC Report on Jobs [1][2] | 8 July 2026 | ~400 recruitment agencies, June fieldwork | Temp billings up at fastest rate since April 2023; permanent decline softest in three months | Hiring risk is being parked in temp and contract work |
| CIPD Labour Market Outlook [4][5] | 18 May 2026 | 2,000+ employers, early-2026 fieldwork | 63% recruiting, but net employment balance +10 and cost management top priority for 58% | Replacement hiring under strict cost control |
| Bank of England Agents' summary [7] | 24 July 2026 | Business interviews to end-June | Employment intentions broadly flat; recruitment a little easier than normal | A pause rather than a contraction; employers hold the initiative |
The three disagree less than their tones suggest. They watch from different angles — agency billings, stated intentions, structured interviews — and over different periods: the CIPD's fieldwork came early in the year, before the June inflection the REC panel recorded. The shared core is not in dispute: recruitment is continuing, but commitment is rationed. Where they differ is momentum. The two freshest reads — REC's June data and the Bank's intelligence to end-June — are the least negative, which is consistent with a market bottoming out but does not yet prove one.
For scale, the ONS put total UK vacancies at 712,000 in April–June, down 0.9% on the quarter, with 2.5 unemployed people per vacancy in March–May — a ratio unchanged since July–September 2025 [8][9]. The market has stopped loosening; it has not tightened, as our reading of the July ONS release sets out in full.
What does this mean for hiring costs this autumn?
If cost management now outranks productivity and growth on the strategic agenda [4], the cost of the hiring channel belongs in the same spreadsheet as the salary. What follows is our analysis of the channel economics, not a claim made by the surveys above.
Temporary and contract staffing solves the reversibility problem — which is exactly why billings are surging [1] — but the flexibility is rented. An agency margin is charged on every hour worked for as long as the assignment runs, and converting a good temp to permanent staff typically triggers further fees. Advertised hiring is cheap per posting, but posting volumes are falling [5] while candidate availability rises [1]: more applicants per advert, and more sifting to reach them.
Face-to-face hiring is the fixed-cost option. A standard stand at one of our careers fairs is £495 (premium stands £695+VAT) and includes twelve months on our jobs board; employers testing the water first can post roles free on our jobs board. A typical fair runs 10am–2pm with local and national employers in one room, and we run more than 150 events a year across 65 UK towns and cities. With candidate availability rising for months on the REC's measure [1], the pool on the other side of the table is still deepening. None of these channels guarantees a hire — no channel does. The argument is about cost discipline: in a year when 58% of employers put cost first, a fixed fee with a twelve-month jobs board listing attached is the easiest hiring line there is to budget.
Timing favours the decision being made now rather than in October. The autumn season builds from late August to its closing fixture, the London Careers Fair on 6 November — the natural target for employers hiring at volume before year-end.
The full autumn 2026 schedule is live now, and exhibiting details — including stand options and what is included — are at our employer hub.