Interim day rates top £1,000 as boards delay senior hires

Private sector interim managers earned an average of £1,004 a day in the year to March 2026, up 3.5% on the previous year and the first time the figure has crossed £1,000, according to the Institute of Interim Management Survey 2026. The survey described the wider interim market as fairly flat, and for the first time it asked how interims delivered their most recent assignment: nearly a quarter said they worked on a fractional basis.

For HR leaders, the number signals something other than a wholesale shift to contract leadership. Search firm Executive Recruit found that of the interim leaders it placed in the past eight months, 22% came in after a sudden departure or to run a specific project. Another 46% filled a role while the board put its permanent search on hold.

Is the £1,000 day rate really a shift to contract leaders?

The rise in private sector day rates is sometimes read as UK boards choosing to hire leaders on contract rather than appoint them permanently. Mark Geraghty, partner at Executive Recruit, said that doesn't match what he's seen in his searches this year.

"From what I have seen this year, and from conversations with peers and clients across the search market, boards have been slow to commit to senior appointments," Geraghty said. "In some cases, they involved a departure that needed covering or a problem that had to be fixed before anyone could take on the permanent role."

His read is more blunt: "Most boards I spoke to, and most colleagues I compared notes with, were not seeing a choice between interim and permanent hires. Boards were holding back on both. The interim appointments they did make were for situations where they could not afford to wait."

What does an interim actually cost against a permanent hire?

Executive Recruit's salary data puts the average base salary for a permanent UK Finance Director between £115,000 and £155,000, excluding bonus and benefits, depending on location and business size. At the £1,004 private sector day rate, an interim Finance Director working the survey average of 148 days a year would cost roughly £149,000 in fees — inside that permanent band before any bonus.

The macro backdrop explains the hesitancy. The Treasury's Budget document, published in October, describes hiring in 2026 as subdued. The Office for National Statistics estimated the UK had 702,000 vacancies between June and August 2026 — the lowest level outside the pandemic since 2014.

Are permanent placements recovering?

There are early signs of a turnaround. The KPMG and Recruitment and Employment Confederation Report on Jobs, which tracks recruitment activity at all levels, recorded a second consecutive monthly rise in permanent placements in September — the strongest increase in four years. It also logged the first rise in demand for permanent private sector staff in more than two years. The recent Budget left the headline rate of National Insurance unchanged.

"Some boards told me over the summer that they would review their leadership structure after the Budget," Geraghty said. "The Budget did not change the cost of a senior appointment, so that reason is gone. The conversations I am having now are more about whether to make an appointment at all, and more boards are saying yes."

Where do fractional roles fit?

Fractional arrangements now surface in the same board conversations, Geraghty said. They suit businesses that need senior expertise for part of the week, and boards at smaller businesses and private equity-backed companies now ask about them by name. His test doesn't change with the contract type: if a board knows what the role must deliver and by when, an interim, fractional or permanent appointment can all work.

"Permanent placements have increased for the past two months and the employer cost position for next year is now known," Geraghty said. "Boards that use the rest of the year to settle what their leadership team should look like will be better placed when candidates begin to move again in the new year."