UK Permanent Hiring Rises for the First Time in Four Years
The News
The latest KPMG and REC UK Report on Jobs, compiled by S&P Global from survey responses across roughly 400 UK recruitment consultancies, recorded the first increase in permanent staff placements since September 2022. The Permanent Placements Index edged from 50.0 in July to 50.5 in August — a marginal uptick, but a symbolic one after nearly four years of contraction or stagnation. Temp billings rose for a fifth consecutive month, reaching their second-strongest pace in over three years. Recruiters linked the improvement to growing market confidence and employers moving to expand capacity, though uncertainty about the economic outlook and government policy kept the rate of growth subdued. Starting salaries for permanent staff rose at the quickest pace since January, driven by competition for highly skilled and niche candidates. Overall vacancies fell for a 34th consecutive month, though the decline was the smallest in nearly two years.
Why It Matters
For a TA leader, the signal matters more than the magnitude. A 0.5-point move off the no-change line is not a boom, but it marks the end of a sustained downward drift that has shaped hiring budgets, vendor contracts and team structures since late 2022. If the index holds above 50 through the autumn — and the temp billings trend suggests employers are already testing the water — permanent recruitment volumes will start to recover just as the UK's Employment Rights Act reforms tighten probation processes and raise the cost of getting a hire wrong. The combination of slightly more hiring pressure and significantly more hiring risk is where TA leaders need to focus their process investment now.
Taking Action
All action is situated in your corporate context. These are starting points, not prescriptions — choose what fits.
Connect
Who to talk with in your enterprise
Your head of talent acquisition: the report notes that temp billings are growing faster than permanent placements, signalling employer preference for flexibility. Ask whether your contract and interim strategy is ready to scale if permanent hiring stays cautious through Q4. Your head of reward: starting salaries rose at their sharpest rate since January — confirm your offer ranges benchmarks are current for the roles you are most likely to recruit for this autumn.
Inspect
What to take a closer look at
Pull your Permanent Placements Index trend alongside your own req-open and time-to-fill data for the last six months. If the market is turning, your hiring manager expectations and SLA assumptions may be calibrated for a deeper downturn than the one you are now entering. Check that your probation-period processes are robust ahead of the January 2027 unfair dismissal reforms — the six-month qualifying period cut and removal of the compensation cap will make a bad hire materially more expensive.
Reflect
What to think about more deeply
If permanent hiring is coming back after four years of decline, what did your team actually learn during the downturn — and how much of it will you keep when the volume returns?