Permanent placements and temporary billings in the UK grew at the strongest rate in four years in September 2026, according to the REC and KPMG Report on Jobs, with both indices standing at 50.9 — above the 50 mark that signals month-on-month growth.

The data, compiled by S&P Global from questionnaire responses by around 400 recruitment and employment consultancies, shows hiring demand improving across permanent and temporary roles at the same time. For HR leaders, the shift touches headcount planning, pay benchmarking and time-to-fill assumptions heading into the autumn Budget cycle.

What changed in September?

Growth picked up slightly from August and marked the strongest rise in four years. Several underlying indicators moved in the employers' favour:

• The permanent vacancy index rose 1.6 points to 48.4 — the softest fall in vacancies since August 2024.
• The temporary vacancy index slipped marginally, from 49.1 to 48.9.
• Overall demand for workers declined at its weakest pace in just over two years, with the seasonally adjusted index up from 47.0 to 48.5.
• Total staff availability improved: the index fell from 60.6 to 57.2, meaning more workers were available. Candidate numbers have risen every month for just over three and a half years.

Permanent staff availability decreased from 60.9 in August to 57.2 in September, while temporary staff availability rose from 56.1 to 57.4.

What does it mean for pay?

Salary pressure eased on both sides of the market. The permanent salaries index fell from 54.1 to 53.4, and the temporary wages index dropped from 53.5 to 52.6. Growth in advertised pay continues — both indices remain above 50 — but at a slower rate than in August.

How solid is the recovery?

REC interim chief executive Maxine Bligh called it a market "revving its engine", with a second successive month of growth in permanent placements.

"The last time we saw a sustained run of growth in permanent placements was between March 2021 and September 2022," Bligh said. "If this trend continues, we could see genuine momentum building across the labour market, with both permanent and temporary hiring moving in the same direction, which is encouraging for jobseekers and the economy."

She noted that permanent vacancies rose across the private sector for the first time in more than two years — a signal, she said, that the sector is ready to invest.

Jon Holt, group chief executive and UK senior partner at KPMG, struck a more cautious tone: "For the second month in a row we are seeing the jobs market starting to flicker back to life, with businesses increasing their hiring across both permanent and temporary roles, and for the first time in over two years vacancies grew in the private sector."

Holt warned that "this remains a fragile recovery, and in some sectors it could be seen as an employer's market as the number of people looking for roles increases". He pointed to uncertainty around energy prices and higher borrowing costs as headwinds.

What should employers watch next?

Both leaders framed the upcoming Budget as the decisive variable. Bligh said the chancellor "cannot seize this moment with talk of stability alone", arguing employers want to hear how the government will pursue growth. Holt said businesses will look to the Budget, due later this month, "for greater certainty in tax policy and a sense that the government is willing to create the right conditions to turn this emerging confidence into investment and ultimately jobs".

The report describes the summer as a period of gradual improvement in recruitment activity, but with employers still balancing hiring needs against economic uncertainty and cost pressures.

If the current trend holds into the fourth quarter, HR teams could face a slowly tightening permanent market — but with candidate supply still rising and pay growth cooling, the balance of negotiating power has not yet tipped decisively toward jobseekers.