Key Points
- Permanent staff placements in the Midlands grew in August 2026 at the fastest pace recorded since November 2022.
- Local recruitment agencies reported higher permanent appointments for the second month in a row.
- Temporary billings in the region fell for a second straight month, dropping at the sharpest rate in 13 months.
- The Midlands was the only one of the four monitored English regions to record a fall in temporary billings, while permanent hiring grew in London and fell in the North and South.
- Permanent job vacancies fell for the 27th month in a row, marking the largest drop among the four regions, though the pace of decline slowed compared to earlier in 2026.
- Ongoing workforce redundancies drove a sharp rise in available permanent candidates, though the growth rate remained the lowest of any English region.
- Permanent starting salary growth in the Midlands was the slowest in the UK, while temporary worker pay rose at its fastest rate in 15 months.
Midlands (Birmingham Express) September 9, 2026 — Recruitment activity across the Midlands has delivered a significant shift in dynamics, as the region recorded its fastest rate of growth in permanent staff placements since late 2022.
According to the latest KPMG and REC, UK Report on Jobs: Midlands survey compiled by S&P Global, recruitment agencies across the region registered a second consecutive monthly rise in permanent appointments during August 2026.
The uptick signals a notable reversal from the prevailing trends observed over the past four years, during which local employers largely placed permanent hiring on hold and relied heavily on flexible temporary labor. Panellists involved in the survey attributed this upturn to an encouraging improvement in underlying business confidence and a growing willingness among employers to make long-term workforce commitments.
How do temporary billings contrast with permanent hiring in the region?
As reported by S&P Global compilers of the KPMG and REC report, temporary staff billings across the Midlands contracted for the second month in succession during August 2026. The rate of decline in short-term contract billings was the most pronounced recorded in 13 months.
This makes the Midlands the sole English region out of the four monitored to register a contraction in temporary staff recruitment. The national trend elsewhere saw temporary billings expand, supported by client demand for temporary project cover, but Midlands employers appeared to pivot back toward direct permanent placements as long-term visibility improved.
What does leadership at KPMG say about the regional job trajectory?
As reported by the Greater Birmingham Chambers of Commerce, Kate Holt, People Consulting partner at KPMG in the Midlands, stated: “August’s figures give us one of the clearest signs yet that confidence in the Midlands jobs market is starting to improve. The main point of optimism is the strongest rise in permanent placements since late 2022 — an encouraging sign that businesses are becoming more confident about making longer-term hiring decisions after an extended period of caution.”
However, Kate Holt also added a note of caution regarding the sustainability of the trend, stating: “That said, this is still an early and uneven recovery. Jobseekers still face challenges: permanent vacancies continue to fall sharply, temp billings have weakened and candidate supply continues to rise. The key question now is whether this improvement in permanent hiring can translate into a broader and more sustained recovery in demand.”
How is the Recruitment and Employment Confederation evaluating the labor shift?
As reported in the S&P Global news release, Maxine Bligh, interim Chief Executive Officer at the Recruitment and Employment Confederation (REC), stated: “The job market is starting to power up again in the Midlands after employers had permanent hiring on the standby button for the past few years in the region. It is a pity that the Midlands is the only English region to record a fall in temp billings given these offer flexibility and easy entry into the job market, but this is after a year of solid monthly growth in such hiring.”
Addressing policymakers and corporate leaders, Maxine Bligh further highlighted: “Government, business and trade unions must act to shore up this fragile momentum in the job market. This is not the time to take the job market for granted. Instead, government should follow through on its commitment to lessen burdens on business. It also means delivering an Autumn Budget that demonstrates the government is serious about backing business and provides employers with the confidence they need to hire, invest and grow.”
What is happening to vacancies and candidate availability across the Midlands?
Despite the bounce in permanent hiring, overall demand for workers in the Midlands remains constrained. August survey data revealed a 27th consecutive monthly drop in permanent job vacancies across the region. Although the rate of vacancy contraction was the softest seen in 2026, the Midlands continued to record the steepest drop in permanent vacancies among all four monitored English regions. Temporary job vacancies also registered a modest downturn in August following a brief rise in July.
Concurrently, permanent candidate supply expanded sharply across the Midlands in August. Recruitment panellists noted that restructuring and redundancies across various sectors remained the primary catalyst behind the growing pool of jobseekers. Nonetheless, the rate of increase in permanent staff availability in the Midlands was the weakest among the four English regions. Temporary candidate availability rose for the sixth consecutive month, though its pace of growth continued to ease, posting the slowest expansion nationally.
How are starting pay and inflation impacting regional salaries?
Pay trends across the Midlands demonstrated a clear divergence between permanent and temporary positions in August 2026. Starting salary inflation for permanent job roles remained muted. While permanent starting salaries continued to rise, the rate of growth was minimal and represented the softest pay increase among the four monitored English regions.
In contrast, temporary worker pay inflation escalated rapidly. Short-term staff hourly wages in the Midlands increased at the fastest pace in 15 months, posting the sharpest rate of temporary pay inflation recorded across all English regions. Panellists attributed this acceleration in temporary wages to persistent cost-of-living pressures and intense competition for specialized skills in specific short-term roles.
Background of the Development
The UK labor market has weathered severe macroeconomic headwinds over recent years, marked by persistent inflation, high interest rates, and regulatory shifts that caused widespread employer caution. Following the post-pandemic hiring boom of 2021 and early 2022, economic uncertainty led firms nationwide to freeze permanent headcount growth. The Midlands—a key UK region for manufacturing, automotive, logistics, and professional services—was particularly exposed to supply chain adjustments and rising operational costs.
Between late 2022 and mid-2026, businesses across the Midlands heavily leaned on temporary and contract staff to manage capacity without taking on long-term fixed employment costs. This reliance created a sustained pattern where temporary billings expanded while permanent hiring stagnated. The August 2026 KPMG and REC report marks the first distinct structural pivot away from this holding pattern, pointing toward a gradual stabilization of core corporate strategies and a return to long-term talent acquisition across the regional economy.
Prediction: How This Development Will Affect the Midlands Job Market and Key Audiences
The unexpected resurgence in permanent placements alongside falling temporary billings creates specific outcomes across three key interest groups in the Midlands:
1. For Jobseekers and Professionals
The shift offers significant relief to jobseekers aiming for career stability and permanent contracts after years of reliance on gig or short-term work. However, because permanent vacancies are still declining overall and candidate pools remain inflated by ongoing redundancies, competition for each permanent position will remain intense. Jobseekers possessing specialized, hard-to-replace skills will enjoy stronger leverage, whereas entry-level candidates may face prolonged search timelines.
2. For Employers and Local Businesses
Regional businesses face a dual challenge. While improved market stability encourages companies to secure permanent talent before hiring costs escalate, the sudden spike in temporary worker pay will increase short-term operational expenses for firms reliant on flexible labor. As the Autumn Budget approaches, businesses are likely to remain disciplined with salary budgets, preferring targeted recruitment over broad pay increases across existing teams.
3. For Recruitment Agencies and Regional Policymakers
Recruitment firms will need to rebalance their revenue models away from short-term placement reliance and toward executive search and permanent staff sourcing. For regional economic leaders and the UK government, the findings underscore a fragile turning point; policy decisions around corporate taxation, employer National Insurance, and regional investment will determine whether August’s permanent hiring surge develops into sustained regional economic growth or stalls back into defensive caution.
