As participants in the REC/KPMG UK Jobs panel, we’re pleased to share the latest insights from the June 2026 labour market data.
This month’s report offers some welcome signs that the market may finally be finding a little more stability. Whilst permanent recruitment remains subdued and vacancies continue to decline, the pace of contraction is easing and temporary hiring continues to strengthen as employers look for greater flexibility in an uncertain economic climate.
Combined with the latest Indeed Hiring Lab data, the picture remains one of cautious optimism. Hiring is still below previous levels, but there are encouraging indications that employers are beginning to move forward with recruitment plans that have been on hold for much of the past year.
📉 Permanent Hiring Shows Signs of Stabilising
Permanent recruitment continued to decline during June, but the rate of contraction slowed significantly.
Nationally, permanent placements fell only marginally, representing the softest decline for three months. Whilst organisations remain cautious around increasing permanent headcount, recruiters reported that some employers have started progressing previously delayed recruitment projects as confidence slowly begins to return.
Within the South of England, permanent hiring also moved closer towards stabilisation, recording its weakest decline since the downturn began in April 2023. Recruiters continued to cite:
- Hiring freezes easing rather than expanding
- Ongoing budget scrutiny
- Economic uncertainty
- Employers remaining selective with permanent appointments
London showed a similarly encouraging picture, with permanent placements now only declining marginally.
🚀 Temporary Hiring Continues to Lead the Market
Temporary recruitment remains the strongest area of the labour market.
Across the UK, temporary billings increased at their fastest pace for more than three years, reflecting employers’ continued preference for flexible workforce solutions whilst economic uncertainty remains.
The South of England recorded another month of strong temporary hiring, whilst London experienced its strongest growth in temporary billings for over two-and-a-half years. Recruiters highlighted:
- Increased project work
- Greater demand for interim expertise
- Organisations favouring contract and fixed-term solutions before committing to permanent hires
Within the HR market, this continues to mirror what we’re seeing with growing demand for:
- Interim HR professionals
- Fixed-term contracts
- Change and transformation specialists
- Employee Relations expertise
- Project-based HR resource
📊 Vacancies Continue to Decline
Although hiring activity is showing signs of improvement, overall vacancy numbers remain under pressure.
Nationally, demand for staff declined at the quickest pace since January, driven largely by another fall in permanent vacancies. Official ONS data shows vacancy numbers sitting at around 707,000, the lowest level for more than five years and, excluding the pandemic period, the lowest since 2014.
Across the South of England, permanent vacancies remain weaker than the UK average, although temporary vacancies are moving much closer towards stabilisation. London continues to outperform many other regions, with both permanent and temporary vacancy levels remaining comparatively resilient.
👥 Candidate Availability Remains High
Candidate availability continued to increase during June, although not quite as rapidly as earlier in the year.
Recruiters continue to report that redundancies, restructuring programmes and fewer available vacancies are increasing the number of HR professionals actively seeking new opportunities. However, some candidates are also becoming more cautious about moving roles in the current market.
For employers, this means access to a larger talent pool than we’ve seen for several years.
However, whilst candidate availability is high, businesses continue to compete for individuals with specialist HR expertise, strong commercial experience and proven change capability.
💷 Salary Trends Begin to Diverge
Pay trends continue to vary by region.
Nationally, starting salaries and temporary pay rates both strengthened during June as organisations competed for specialist skills. However, the picture is slightly different across the South of England, where permanent starting salaries fell for the first time in eight months as recruitment budgets remain under pressure. Temporary pay growth also softened locally. For employers, this provides a little more breathing space after several years of significant salary inflation, although specialist HR professionals continue to command competitive packages.
💡 What This Means for Employers and HR Leaders
The June data suggests the market may finally be moving towards greater stability.
Whilst permanent recruitment remains cautious and vacancy numbers continue to fall, there are clear signs that employers are beginning to move forward with recruitment plans that have been delayed over recent months. Temporary and interim hiring continues to provide organisations with the flexibility they need, and this remains one of the strongest areas of the market.
For HR leaders, this is still a market where careful workforce planning, retention and flexibility remain key. Organisations willing to move decisively for critical hires continue to have access to an exceptionally strong talent pool, particularly within HR.
Whilst we’re not seeing a full market recovery just yet, June does feel like one of the most encouraging reports we’ve seen for some time. Confidence is returning gradually, and if economic conditions remain stable, it will be interesting to see whether this momentum continues through the second half of the year.
Sources:
- KPMG & REC UK Report on Jobs – 8th July 2026
- KPMG & REC London Report on Jobs – 8th July 2026
- KPMG & REC South of England Report on Jobs – 8th July 2026
- Indeed Hiring Lab – UK Labour Market Update – 24 June 2026