Review of the UK Jobs Market – August 2025
Welcome to our Review of the UK Jobs Market for August. Each month, we share market insight on the state of the UK jobs market.
You can either read our short blog, or see our infographic.
The main findings were:
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- Staff hiring falls at softer but still marked rate
- Sharpest rise in candidate numbers since November 2020
- Overall demand for staff continues to fall
- Permanent starters’ salaries increase only marginally
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Staff Appointments
Permanent placements decline at softest pace since May
There was a slower, but still marked, reduction in the number of people placed into permanent roles i n August. The rate of decline was the softest since May. Appointments have now fallen in each of the past 35 months. Placements fell due to fewer job opportunities, higher payroll costs, and hesitancy among employers to recruit new staff amid reduced confidence around the outlook.
Downturn in temp billings eases in August
August signalled a further drop in billings from the employment of short-term staff. Though solid, the rate of contraction was the weakest recorded in three months and not as pronounced as the average recorded in 2025 to date. Companies cut back on temporary hiring due to higher operating expenses and reduced business activity.
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Vacancies
August sees further sharp drop in demand for workers
Underlying data pointed to further falls in demand for both permanent and temporary workers during the latest survey period. Vacancies for permanent positions fell at a sharp and accelerated rate that was the most pronounced in six months. Demand for short-term staff meanwhile fell at a slightly softer but still solid pace.
The ONS) indicated that overall vacancies fell 44,000 over the three months to July 2025. Vacancies have now fallen continuously for just over three years. At 718,000, the total number of job opportunities was the lowest recorded since the three months to April 2021. This figure was also nearly 10% below the pre-pandemic level (795,000 in the three months to March 2020).
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Staff Availability
Accelerated upturn in supply of permanent candidates
The expansion in permanent labour supply gathered pace in August, posting its highest reading since November 2020. Excluding the period covering the height of the COVID-19 pandemic in 2020, latest data marked the steepest rise in candidate numbers since July 2009 during the global financial crisis. Redundancies and fewer job opportunities were cited as key drivers of growth. There were also reports of people seeking new roles due to concerns over current job security.
Temp candidate numbers rise rapidly in August
There was a stronger rise in the number of candidates available for short-term roles during August. the fastest seen since late-2020. While company layoffs were frequently linked to the latest upturn in candidate supply, fewer vacancies and delayed hiring decisions had also driven up availability.
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Pay Pressures
Permanent salary growth slips to four-month low
Salaries awarded to newly-placed permanent workers increased only slightly midway through the third quarter. While there were cases of employers paying higher salaries to secure sought-after skills, there were also reports that weaker demand for staff and tighter hiring budgets had constrained growth.
Temp wages increase only modestly in June
Average wages for short-term staff increased again in August. Although the rate of inflation quickened from July, it was modest overall and much slower than the historical average. There was little movement in wages due to improved candidate availability and muted demand for workers.
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Source: KPMG and REC UK Report on Jobs 8th September 2025
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