The latest KPMG and REC UK Report on Jobs, produced by S&P Global, has highlighted a labour market that remains cautious but resilient as businesses continue to navigate economic uncertainty, rising operational costs and geopolitical pressures.
While permanent hiring activity slowed again in April 2026, the report also revealed encouraging signs across temporary recruitment, candidate availability and sector-specific demand — demonstrating that many employers are continuing to hire strategically despite wider market challenges.
Permanent Hiring Slows as Businesses Prioritise Flexibility
According to the report, the UK Permanent Placements Index fell to 47.5 in April, signalling another monthly decline in permanent hiring activity. Recruitment consultancies cited subdued business confidence, inflationary pressures and ongoing uncertainty surrounding global events as key reasons for delayed hiring decisions.
However, the slowdown was still less severe than levels seen throughout much of 2025, suggesting that the market may be stabilising rather than deteriorating further.
Scotland Continues to Show Positive Momentum
One of the clearest trends emerging from the data is the growing preference for temporary and contract recruitment. The Temporary Billings Index rose to 50.4 in April — marking the strongest increase in temporary hiring activity in two-and-a-half years.
This reflects a growing number of businesses seeking greater workforce flexibility while continuing to progress operational and growth plans.
Vacancy Declines Begin to Ease
The report also showed that demand for staff continues to soften, with vacancies declining for the thirtieth consecutive month. However, the pace of decline eased to its slowest level in almost a year.
Permanent vacancies continued to fall more sharply than temporary opportunities, further reinforcing the current shift towards flexible hiring models.
Official ONS data included within the report showed total UK vacancies falling to 711,000 — the lowest level seen in nearly five years. Despite this, several sectors continue to demonstrate strong demand for skilled professionals.
Engineering was the only sector to record growth in permanent vacancies during April, while Nursing, Medical & Care and Blue Collar sectors all showed stronger temporary demand.
Areas including AI, Cyber Security, Data Engineering, Finance, Healthcare and Skilled Trades also continue to experience notable skills shortages across the UK recruitment market.
Candidate Availability Continues to Rise
Another key trend highlighted in the report is the continued increase in candidate availability.
The Total Staff Availability Index rose to 61.0 in April, indicating a further sharp increase in the number of professionals actively seeking work opportunities. Recruiters linked this rise to redundancies, reduced hiring activity and wider economic caution among employers.
For businesses, this presents both opportunities and challenges. While larger talent pools may ease hiring pressures in some areas, competition for highly specialised skills remains significant.
Salary Growth Remains Positive but Subdued
Despite softer demand overall, salary growth across both permanent and temporary markets remained positive in April.
Permanent starting salaries continued to rise, although growth remained below historical averages as businesses balanced talent attraction with tighter budgets and cost management pressures.
Temporary pay rates also increased for the fifth consecutive month, partly driven by national minimum wage and living wage increases.
Official ONS earnings data showed UK pay growth slowing to 3.8% annually — the weakest increase since 2020.
The Scottish labour market delivered more positive results compared with wider UK trends.
The report found that Scotland recorded a fourth consecutive month of growth in permanent placements during April, demonstrating continued resilience within the Scottish recruitment market.
Although temporary billings in Scotland declined slightly, permanent hiring activity, salary growth and candidate availability all remained positive overall.
This reflects continued demand across key Scottish sectors including finance, engineering, technology, professional services and skilled trades.
Supporting Businesses Through a Changing Market
At Anderson Knight, we continue to support businesses and professionals across Scotland and the wider UK with tailored permanent, temporary and contract recruitment solutions.
As hiring trends continue to evolve, workforce planning, flexibility and access to specialist talent remain critical for organisations looking to grow successfully in 2026.
Whether you are looking to strengthen your team or explore your next career opportunity, our experienced consultants are here to help.
📞 0141 348 7777
🌐 www.andersonknight.co.uk
Source: KPMG and REC UK Report on Jobs – April 2026, produced by S&P Global.
