UK recruitment activity weakened again in October, with permanent staff placements falling for the first time in four months and temporary billings dropping for the first time since March. The latest KPMG and REC UK Report on Jobs found employers delaying hiring decisions amid economic uncertainty and rising costs, in the weeks before the Budget. The survey of around 400 recruitment and employment consultancies showed permanent placements falling at the second-quickest pace of 2026, after May.

Employers delay decisions before the Budget

The permanent placements index fell to 46.6 in October, down from 50.9 in September, with any reading below 50 indicating a decline. Temporary billings slipped below that mark, falling to 48.9. Data for the report was collected between 12 and 26 October, before the Chancellor's Budget on 28 October and before the Bank of England raised Bank Rate to 4 per cent. Jon Holt, group chief executive and UK senior partner at KPMG, warned there was a risk that the green shoots seen in the jobs market could stall.

There were some brighter signs beneath the headline figures. Overall demand for staff fell at its slowest pace in 26 months, and demand for permanent staff rose in six of the ten sectors tracked, led by IT and computing and by engineering, while retail and hotel and catering fell most. Candidate availability rose, with the staff availability index reaching 59.4, as redundancies and fewer openings pushed more people into the jobs market. Starting salaries rose at a faster pace as employers competed for scarce talent, and ONS data cited in the report showed 691,000 vacancies in the three months to September, down 5.1 per cent on the year. The next labour market figures are due from the ONS on 17 November, as Personnel Today reports.