The Office for National Statistics has surprised economic commentators by revealing that the UK economy grew by 0.6% in the first quarter of the year, following very modest 0.2% growth in Q4 2025. But while this percentage is higher than expected, the war in the Middle East looks as though it has already prevented Q2 from building on its successes. Not only do rising oil prices and bond yields suggest this, but there are other recent signs of turbulence, including the latest jobs report from KPMG, S&P Global, and the Recruitment and Employment Confederation (REC).
This report reveals that, after showing signs of recovery earlier in the year, permanent hires in the UK declined at a faster rate in April. They’ve been declining just as temporary hires have increased for the first time in three months, providing a clear signal that British enterprises are adapting to economic uncertainty by increasing the flexibility of their workforces. However, economic factors aren’t the only reason why businesses are turning to temp workers, with recruitment analysts suggesting that the growth of AI may also be playing a role.
“Employers favour flexible staff as overall demand for workers falls.”
KPMG and REC, UK Report on Jobs, May 2026
In the midst of such changes, there has also been an evolution in executive hiring patterns. On the one hand, organisations have become more deliberate about filling particular C-suite roles, creating positions attached to core functions and competences. And on the other, they’re also showing an increased preference for candidates who can connect the dots between technological development, workforce management and output.
From at least one perspective, the latest KPMG jobs report makes for a sobering read, in that overall demand for staff, whether temporary or permanent, has declined in Britain for the thirtieth consecutive month. While the report notes that “the rate of contraction continued to ease” to its slowest level for almost a year, permanent placements fell steeply, and have been falling at varying rates since 2022. Meanwhile, temporary appointments have also fallen for much of this period, despite witnessing a few phases of modest growth.
Temporary hiring models becoming more permanent
What has changed in April is that temporary hires have again registered slight growth, doing so for the third time within the past year, as preferences shift a little more towards flexible employment arrangements. Recruitment experts agree with the report in asserting that the most important reason for this is the ongoing conflict in Iran, which has provided geopolitical instability and economic pressures in more or less equal measure.
“While technological change — particularly the rapid adoption of AI — is influencing hiring patterns, broader macroeconomic and geopolitical uncertainty continues to play a significant role,” says Chris Crawford, the Practice Director of Interim, UK at global recruitment consultancy Michael Page.
Speaking to Raconteur, Page explains that interim hiring is increasingly becoming a “core part” of workforce strategies, as companies adapt to unpredictable environments and take a more considered approach to recruitment. “Rather than focusing purely on filling roles, many are taking a more strategic, skills-led approach — assessing the capabilities needed both immediately and over the longer term,” he says. “In practice, this often means rethinking traditional role structure, prioritising specific skillsets, and building more flexible workforce models.”
“Rather filling roles, many businesses are taking a more strategic, skills-led approach.”
Chris Crawford, Practice Director, Interim Practice
It’s in such a context that temporary workers have come to account for 5.5% of all UK employees, according to data from the ONS, up from an all-time low of 5% between February and April 2024. While this percentage has been higher in the UK in previous years, passing 7% for much of the mid- to late-90s, it’s interesting to note that, during this period, between 35% and 43% of such workers cited not being able to find a permanent job as a reason for taking short-term positions. This percentage has been under 25% since February 2025, indicating that there has been an increasing acceptance of or demand for temporary employment.
In other words, a preference for temporary hiring has become somewhat mutual on both sides of the equation, with Victoria Allwright — a Director at IT recruitment specialist Experis — suggesting that the ONS data is indicative of “a broader shift towards workforce flexibility.” Allwright tells Raconteur that organisations are looking for “more agility” in their workforce planning, and that blended employment models have increasingly come to the fore in recent months.
She says, “This is particularly evident where demand is uncertain, programmes are time-bound or where the skills required are specialist and difficult to hire permanently.”
AI as an accelerator of hiring trends
These factors have given rise to a wait-and-see recruitment strategy, as employers delay hiring permanent staff until market and economic conditions become more consistent and predictable. For Allwright, this process has also been accelerated by the emergence of AI, which is now developing so rapidly that it has also had a similarly destabilising effect on company forecasting.
“Many organisations are investing in areas such as AI, automation, data, cloud and cyber, but they don’t always know what skills they will need in 12 or 18 months’ time,” she says. “Temporary and contract hiring gives the flexibility to access specialist skills quickly, deliver transformation, test new operating models and respond to demand without overcommitting too early.”
“Temporary and contract hiring gives the flexibility to access specialist skills quickly.”
Victoria Allwright, IT Services Director, Experis
Chris Crawford tells a similar story, in that technological change has been shaping the kinds of expertise and skills required by organisations. He explains, “As organisations continue to define their approach to AI and digital transformation, we’re seeing growing demand for specialist skillsets — from data expertise through to strategic leadership capability.” He adds that interim professionals have been playing “a critical role” in this situation, providing the experience and expertise necessary to handle transitional projects as enterprises implement new technologies and workflows.
Allwright expects the increased preference for temp workers to continue in the foreseeable future, particularly in the areas of digital transformation, cybersecurity, data, and AI. However, she nonetheless affirms that permanent hiring is not going to disappear, since organisations need and benefit from permanent employees in terms of continuity, culture, and long-term ownership. She says, “The stronger model is a blended workforce: permanent employees providing continuity and ownership, supported by temporary and specialist resources where speed, flexibility or niche expertise is needed.”
Holistic business leaders increasingly in demand
The shift to a more blended workforce has also happened in parallel with a change in executive hiring, with Allwright explaining that such hiring has become more selective as organisations are now “much more deliberate” about the roles they create and appointments they make.
“In the current market, companies are less likely to hire senior leaders speculatively,” she says. “They want clear evidence that a role will drive transformation, growth, cost control, operational resilience or technology adoption.”
Allwright notes that businesses are increasingly looking for leaders who can connect the technical side of things with the organisational side, an account also provided by Donna Croucher, who is Senior Partner and Head of Practices at Page Executive. Croucher suggests that, in the technology space at least, there’s an ongoing shift in the type of leaders organisations are seeking. Instead of tech competence on its own, more emphasis is being placed on leadership capabilities, including the ability to generate and lead with trust.
“As technology continues to evolve, the most in-demand executive skills are those that cannot be easily replicated.”
Donna Croucher, Senior Partner and Head of Practices, Page Executive
“Organisations are increasingly looking for technology leaders who can operate as true business leaders — combining strategic thinking with strong communication and stakeholder management skills — rather than purely technical specialists,” she tells Raconteur.
Almost counterintuitively, human-centric capabilities are coming increasingly to the fore as tech becomes more central to what businesses do. “As technology continues to evolve, the most in-demand executive skills are those that cannot be easily replicated — from building culture and leading teams through change, to driving engagement and aligning organisations behind a shared vision,” Croucher concludes. “These qualities are becoming critical differentiators at C-suite level.”
The Office for National Statistics has surprised economic commentators by revealing that the UK economy grew by 0.6% in the first quarter of the year, following very modest 0.2% growth in Q4 2025. But while this percentage is higher than expected, the war in the Middle East looks as though it has already prevented Q2 from building on its successes. Not only do rising oil prices and bond yields suggest this, but there are other recent signs of turbulence, including the latest jobs report from KPMG, S&P Global, and the Recruitment and Employment Confederation (REC).
This report reveals that, after showing signs of recovery earlier in the year, permanent hires in the UK declined at a faster rate in April. They’ve been declining just as temporary hires have increased for the first time in three months, providing a clear signal that British enterprises are adapting to economic uncertainty by increasing the flexibility of their workforces. However, economic factors aren’t the only reason why businesses are turning to temp workers, with recruitment analysts suggesting that the growth of AI may also be playing a role.
"Employers favour flexible staff as overall demand for workers falls."
