The latest KPMG and REC, UK Report on Jobs: Midlands survey, compiled by S&P Global, indicated a further solid fall in permanent placements across the Midlands in November amid reports of lower demand for workers, higher employment costs and economic uncertainty. By contrast, temp billings increased for a fourth month in a row, and at the quickest rate since June 2024.
The decline in permanent hiring activity contributed to a further steep increase in candidate availability. Pay trends diverged, however, with the rate of starting salary inflation for new permanent joiners accelerating to a three-month high. Temp hourly pay meanwhile fell marginally and for the first time in a year.
The KPMG and REC, UK Report on Jobs: Midlands is compiled by S&P Global from responses to questionnaires sent to around 100 recruitment and employment consultancies in the Midlands.
Softer but still solid decrease in permanent placements
Permanent placements fell in the Midlands for the sixth successive month during November. The rate of decrease was solid, but eased to the softest in three months. Survey respondents indicated a range of downside factors that had weighed on permanent staff appointments including uncertainty surrounding the Budget and economy, a lack of suitably skilled candidates and higher employment costs.
The reduction seen in the Midlands was the softest of the four monitored English regions.
Recruiters in the Midlands recorded a sustained increase in temporary billings in the penultimate month of the year, extending the current period of growth to four months. The rate of increase was sharp and the most pronounced in nearly one-and-a-half years. In anecdotal evidence, respondents noted a general pick-up in demand for temp staff. The Midlands and London both recorded increases in temp billings in November, contrasting with sharp decreases in the North and South of England.
Demand for permanent staff in the Midlands fell in November, extending the current decline period to 18 months. The fall in permanent vacancies was the weakest since May, however, and softer than the UK average.
In contrast, there was a sustained rise in demand for temporary workers in the Midlands. While modest, the rate of increase was the steepest since June. Moreover, the uplift in the Midlands contrasted with reductions seen across the other three monitored English regions.
Softer upturn in permanent candidate numbers
The number of candidates available for permanent roles in the Midlands continued to increase markedly in November. That said, the rate of growth slowed for the third month in a row to reach the slowest since October 2024. Moreover, the rise in the Midlands was considerably weaker than the UK-wide average. Panellists indicated that redundancies remained a major factor behind the increase in permanent candidate supply.
Recruitment consultancies in the Midlands reported that a lack of temp job opportunities and increased redundancies had contributed to a further rise in temp candidate availability in November. The rate of increase quickened from that seen in October, and was at the most prominent since September 2020. The Midlands posted the second-slowest rise in temporary staff availability of the four monitored English regions, ahead of only the North of England.
Sharpest rise in starting salaries for three months
Salaries for new permanent joiners in the Midlands continued to rise during November. The pace of salary inflation accelerated from the previous survey period and was the strongest registered since August. Recruiters often indicated that higher salaries were offered to attract suitably skilled candidates.
The rise in permanent salaries in the Midlands was faster the UK average, and was the strongest of the four monitored English regions.
Recruiters in the Midlands signalled a decrease in temp pay at the midpoint of the fourth quarter. Although the rate of reduction was only marginal, it was the first seen in exactly one year. Moreover, the fall in the Midlands contrasted with unchanged hourly pay rates seen on average across UK as a whole.
Commenting on the latest survey results, Kate Holt, People Consulting Partner at KPMG in the Midlands said: “The Midlands continues to outperform other regions, with permanent placements falling at the softest rate across England and temporary billings rising at their fastest pace in nearly eighteen months. This dual performance demonstrates resilience – Midlands businesses are maintaining momentum through flexible staffing while showing greater confidence in permanent hiring than their counterparts.
“What’s striking is the pay dynamic. Starting salaries for permanent roles rose at the fastest rate across all English regions, reflecting strong competition for skilled candidates and a willingness among regional employers to invest in quality talent. This stands in contrast to temporary pay, which dipped slightly. For businesses with clarity on their workforce needs, the current environment offers a genuine opportunity to secure critical permanent skills while managing short-term costs through strategic use of temporary staff.”
Neil Carberry, REC Chief Executive, said: “Pre-Budget nerves knocked temporary recruitment back just a little in November in the UK after a growing October, but the overall picture was still relatively benign by comparison to the last year. The market grew in the Midlands, with a fourth successive month of increase in temp billings. With such a late Budget and the Christmas period just around the corner, the key now will be the decisions that employers make for their businesses this coming January.
“We can see signs of the market stabilising in the Midlands and the UK, including an improvement in pay rates for new jobs. But to really get businesses firing, they need confidence. While the Budget was not the horror show of last year, there was little in it to fire the heart of firms. More recently, moves to change the Employment Rights Bill will have landed well, but there is much more to do to get the economy firing. If government’s priority is growth, their report card at the end of 2025 reads ‘Must try harder’.”
