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Recrutiment & Employment Confederation

JobsOutlook: Firms turn to temps as concern for wider economy slows confidence in own business – REC

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Employer demand for temps has risen amid concerns about the economy, according to the latest Recruitment and Employment Confederation (REC) JobsOutlook.

Firms have been feeling progressively more positive about their own prospects for the past 12 months, despite the strong concerns they have about the performance of the wider economy. This trend has reversed this month, with a minor decrease in confidence in investing in their own business. This is likely driven by the shallow recession the UK entered last autumn. Forward trends data – including from this survey – suggest that this month may be a blip, with confidence strengthening again as inflation falls, suggests REC.

In response to this higher uncertainty, hiring intentions for agency workers in the short term increased to +10, from +3. Greater use of temporary work is a typical employer response to this kind of situation.

Neil Carberry, Chief Executive of the REC, said:

“The Bank of England has been squashing growth to get inflation down for the last year – but now we really need to go for growth to boost incomes and fund public services. We are convinced there is underlying growth potential, as seen by the stronger February sentiment on permanent hiring intentions by comparison to the previous two months.”

The survey covers the period just before the Spring Budget 2024. The level of employer concern about the wider economy emphasises again that a clear industrial and workforce strategy is needed. While the Budget contained a number of good initiatives, it fell short of this vital test. No attempt to drive growth will succeed without a proper appreciation of workforce issues.

Neil Carberry said:

“Recruiters are the WD-40 of the labour market. They help companies grow and workers find opportunities – including 25.7m temporary and contract placements in 2022. Their expertise can also help government be more effective. From the Apprenticeship Levy to infrastructure and effective regulation there is a lot more to do that will help tackle inactivity, boost investment and raise wages. But only a true partnership approach, based on a clear industrial strategy, can deliver this.”

Today’s JobsOutlook shows that across December 2023 - February 2024, business confidence in the UK economy improved by two points – but remains strongly negative (-40). When assessing employers’ confidence in making investment and hiring decisions for their own business, sentiment has fallen into negative territory for the first time since this time last year (net: -7). This reverses a year-long trend of gently improving confidence from hirers.  

Given the scale of the growth of the temp market since 2020, some tapering in demand in 2023 was inevitable. But forecast demand for short-term agency worker hiring rebounded strongly (by seven points, to net: +10) in this most recent three-month period. Sentiment in the majority of regions also remained positive. And medium-term forecast (four months to 12 months) also rebounded by 15 points (to net: +15).

At net: +15, the UK-wide balance of employer sentiment towards short term permanent hiring was flat when assessed as a full quarter. But there was a notable uptick in February (net: +26), from net: +10 in December and net: +11 in January. And while the medium-term sentiment dropped by seven points this quarter (to net: +16), respondents were more positive in February (net: +21).


Notes to editors:

1.     JobsOutlook is produced by the REC in partnership with Savanta ComRes. Savanta ComRes interviewed 501 UK employers involved in hiring by telephone between 28 November and 23 February 2024. Data were weighted to be representative of UK adults in employment by region, broad industry sector and public/private split. Savanta ComRes is a member of the British Polling Council and abides by its rules. Data tables are available at

2.     REC has recently published its Dynamic Labour Markets for Growth because no attempt to drive growth will succeed without a proper appreciation of workforce issues. Our proposals cover:

·       Understanding today’s people and labour market challenges.

·       Supporting our labour market transition by preparing for the future.

·       Boosting workforce productivity and driving down inactivity.

·       Regulating for a sustainable and dynamic labour market.


Click here to view all REC press releases and for more information and interview enquiries, contact the REC Press Office on 020 7009 2157, 020 7009 2129 or Outside of regular office hours, please call 07702 568 829.

The REC is the voice of the recruitment industry, speaking up for great recruiters. We drive standards and empower recruitment businesses to build better futures for great candidates and themselves. We are champions of an industry which is fundamental to the strength of the UK economy.

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