Marvin OnumonuKPMG and the Recruitment and Employment Confederation’s (REC) latest UK Report on Jobs found permanent staff appointments fell at a quicker pace in April.
This comes as market uncertainty increased due to the conflict in Iran and rising business costs.
The survey, compiled by S&P Global, reported a modest rise in temp billings for the first time in three months, as some employers preferred flexible staff.
Demand for workers continued to fall overall, but the rate of decline eased and was the softest in nearly a year.
Permanent job opportunities dropped faster than temp roles, and starting salary growth picked up from March but remained weak.
Candidate availability increased again, driven by redundancies and lower demand, though the pace of growth was slower than in 2025.
Permanent staff supply rose slightly quicker than temp staff. Regional trends showed permanent placements fell sharply in the Midlands and the South of England, while London and the North of England saw increases.
Temp billings went up in the Midlands and the South of England, but declined in London and the North of England.
Engineering was the only sector to see an increase in demand for permanent roles.
Hotel & Catering and Retail recorded the largest falls.
Among temp positions, Nursing/Medical/Care and Blue Collar saw greater demand, while Retail posted the sharpest decline.
Neil Carberry, chief executive at REC, said: “So far this year we’ve seen signs of improving momentum but that is now being tempered by the economic effects of the Gulf conflict.
“Businesses will be particularly concerned about the impact on inflation, their borrowing costs and any disruption to wider supply chains.
“The good news is that employers are leaning more on temporary work to move ahead with their plans in this more uncertain time, demonstrating again why temporary and contract work matters so much to growth and jobs.”
Carberry added: “The temporary sector showed its strongest growth in two and a half years last month.
“Government can do more to help firms feel able to commit to permanent hiring too, by addressing the cost of doing business – the key domestic contributor to hiring activity.
“Taking the threat of badly designed guaranteed hours rules off the table would make a huge difference.”
Jon Holt, group chief executive and UK senior partner at KPMG, said: “The small signs of recovery in the jobs market may have been disrupted in April by the uncertainty stemming from the conflict in Iran.
“Although conditions remain more favourable than they were through much of 2025, hiring decisions are being deferred, with the rise in temporary recruitment pointing to chief execs taking a more flexible approach to workforce planning.
“As business resilience becomes a greater priority, that flexibility may help avoid a deeper downturn in the labour market and support growth plans, even as they brace for further economic headwinds.”
