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Recrutiment & Employment Confederation

Report on Jobs: Permanent placements decline for first time since February 2021

Press releases

Key findings

  • Permanent placements fall, temp billings stagnate
  • Further slowdown in vacancy growth
  • Starting salary inflation slips to 18-month low

Data collected October 12-25


Recruitment activity across the UK weakened at the start of the final quarter, according to the latest KPMG and REC, UK Report on Jobs survey, compiled by S&P Global. Recruiters signalled a renewed drop in permanent placements and stagnant temp billings as heightened uncertainty over the economic outlook weighed on staff hiring. Concurrently, there was a further slowdown in rates of vacancy growth for both permanent and temporary staff.

Greater hesitancy to look for or switch roles alongside a generally low level of unemployment led to a further steep drop in the supply of workers. The sustained decline in candidate numbers and cost-of-living pressures continued to place upward pressure on starting pay. However, rates of salary inflation and temp pay growth fell to 18- and 17-month lows, respectively.  

The report is compiled by S&P Global from responses to questionnaires sent to a panel of around 400 UK recruitment and employment consultancies.

Fresh fall in permanent staff appointments

Recruitment consultancies indicated that hiring activity waned at the start of the fourth quarter, as the number of permanent placements fell for the first time in 20 months and temp billings stagnated. Survey respondents often mentioned that heightened economic uncertainty had led some clients to reassess their recruitment plans, while candidate shortages also dampened hiring.

Vacancy growth eases again in October

Although demand for staff continued to increase in October, the rate of vacancy growth softened for the sixth month running. Notably, the upturn in demand was the weakest seen since the current period of expansion began in February 2021, with both permanent and short-term vacancies rising at slower rates.

Overall availability of staff continues to drop sharply

The total supply of candidates fell sharply once again during October, despite the rate of reduction easing fractionally to the slowest since April 2021. The decline in permanent staff availability remained more acute than that seen for temporary labour. When explaining the latest drop in candidate numbers, recruiters commented that people had become more reluctant to switch or seek out new roles due to concerns around the weaker economic outlook, fewer foreign workers and a low unemployment rate.

Starting salary inflation dips to 18-month low

Latest survey data pointed to a softening of pay pressures during October. Although sharp overall, pay awarded to new permanent joiners increased at the slowest rate for a year-and-a-half. At the same time, temp wage inflation slipped to its lowest since May 2021. According to recruiters, starting rates of pay increased due to the rising cost of living and competition for staff.

Regional and Sector Variations

Permanent staff appointments fell across all four monitored English regions in October, with London seeing the steepest rate of reduction.

The Midlands registered the quickest decline in temp billings of all four monitored English regions. Fresh falls were meanwhile seen in London and the North of England, while the South of England bucked the overall trend and recorded a marked expansion.

Slower increases in staff demand were registered across both the private and public sector at the start of the fourth quarter, with only growth of permanent positions in the public sector ticking higher. The weakest upturn in vacancies was signalled for temporary roles in the public sector, while the quickest was seen for permanent positions in the private sector.

Permanent staff vacancies continued to rise across all ten monitored job categories in October, albeit at notably weaker rates than those seen a year ago in the majority of cases. Nursing/Medical/Care topped the rankings, while Retail was placed at the bottom of the league table.

Demand for short-term staff continued to rise across all ten monitored job categories at the start of the fourth quarter. Nursing/Medical/Care, Hotel & Catering and Retail registered the strongest increases in temporary vacancies, while Executive/Professional saw the slowest.


Commenting on the latest survey results, Neil Carberry, Chief Executive of the REC, said:

“The economic and political uncertainty of September and October has caused employers to become more cautious in their approach to hiring than during the frenzy of earlier in the year. Decision-making timelines for permanent hires have extended, for instance. But vacancies and pay are still rising, temporary worker demand is high, and permanent hiring has fallen for the first time in almost two years. Activity, overall, is still well in advance of pre-pandemic levels. We will need to watch how this story develops over months to come, but so far this data suggests heightened employer caution, not a retreat from the market.

“It remains the case that firms in many sectors are struggling to hire, as hours worked remain below their pre-pandemic level despite record-low unemployment. We’re looking to the Autumn Statement later this month to help with removing the brakes on growth by reforming the apprenticeship levy to build a more effective skills system, improving support to help people move from inactivity to work, and align other policy areas – like work permits – with a growth strategy.”

Claire Warnes, Partner, Skills and Productivity at KPMG UK, said:

“The looming recession is clearly impacting the UK jobs market. Employers’ caution in hiring combined with fewer available candidates has resulted in the number of permanent placements falling for the first time in nearly two years. Now more than ever, it’s essential that we focus on upskilling the workforce to support and boost economic recovery when it comes. The jobs market will bounce back, particularly if we invest in the skills of the workforce across all sectors of the economy.”



For more information and interview enquiries, contact the REC Press Office on 020 7009 2192, 020 7009 2157 or Outside of regular office hours, please call 07702 568 829.

For further information on the survey methodology, or for full reports and historical data from the Report on Jobs, please contact

If you are a recruitment business and interested in joining the Report on Jobs survey panel, you can sign up here. By joining the panel, you will get free access to the full Report on Jobs each month.


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