Latest research shows that growth in temporary billings picks up in August

August’s KPMG and REC, UK Report on Jobs: North of England survey revealed a further reduction in permanent staff hiring across the region, but stronger growth in temp billings.

There was a steeper drop in permanent job openings, while growth of demand for short-term staff eased from July’s recent peak.

At the same time, the availability of permanent workers rose at a rapid and accelerated pace. Finally, pay trends improved in August, with both starting salaries and wages rising at faster rates.

Permanent staff hiring across the North of England fell for the third month running during August. Recruitment consultancies often linked the decrease in permanent placements to a reduction in job openings.

Although softer than in July and only modest in nature, the rate of contraction was the strongest of the four monitored English regions. The reduction also contrasted with the long-run trend of strong growth.

August data marked the fourth successive monthly increase in billings received from the employment of temporary workers across the North of England.

The respective seasonally adjusted index ticked up for the fifth month in succession to its highest in just over four years and was consistent with a steep rise in temp billings.

Of the three English regions to signal growth, the North continued to lead the expansion. In anecdotal evidence, recruiters noted that while clients were busier, they often preferred contract workers when additional staff were required.

There was another reduction in permanent job openings across the North of England in August.

The moderate decrease was faster than in July, but slightly softer than the UK average. Growth in temp vacancies was sustained for a seventh month running across the region in August.

The rate of expansion slowed from July’s recent peak and was modest, but compared favourably with a slight fall at the national level.

Adjusted for seasonal factors, the Permanent Staff Availability Index indicated a further uplift in the number of candidates seeking permanent roles across the North of England in August. 

The rate of expansion was rapid and the quickest recorded in a year. It was also by far the most pronounced upturn in availability of the four monitored English regions. The increase in labour supply was driven by redundancies, fewer vacancies and more people seeking new opportunities, according to panel members.

The trend of growth in temporary labour supply across the North of England was stretched to three-and-a-half years in August. Recruiters suggested that higher candidate numbers reflected restructuring efforts at firms and a rise in people entering the job market. Although strong in nature, the rate of expansion was the weakest since early-2024 and slower than the national average.

August survey data pointed to an increase in permanent starters’ pay across the North of England for the ninth straight month.

Efforts to attract suitably skilled staff was the key reason for improved pay offers, according to panel member reports. Though solid and faster than that seen in July, the rate of salary inflation remained weaker than both its long-run average and the UK-wide trend.

Latest data signalled a third successive monthly increase in average hourly wage rates across the North of England. Up slightly from July, the rate of pay growth was the second-strongest in more than two years (behind May 2025) and sharp. Of the four monitored English regions, only the Midlands signalled a stronger rate of inflation than that seen locally.

Chris Stott, Manchester office senior partner at KPMG UK, said: “The jobs market across the north remains mixed. Businesses are getting busier, but many are choosing temporary workers over making longer-term hiring commitments.

“With temporary billings growing at their fastest rate in more than four years, there are encouraging signs of activity, even if businesses remain cautious about what comes next.”

He added: “There are also more people looking for work, but that doesn’t necessarily mean businesses can find the people they need. Skills remain in short supply across areas including engineering, technology and finance, and closing that gap will be important to unlocking stronger growth.

“That’s particularly important for Manchester, where technology, advanced industries and professional services are important parts of the economy.

“We need to make sure businesses can access the talent they need to invest and expand, so that the activity we’re seeing today can translate into more permanent jobs and longer-term growth.”

Maxine Bligh, interim chief executive at the Recruitment and Employment Confederation (REC), said: “The increase in temp placements in the north is gathering momentum, with billings from placing temporary workers rising for the fourth consecutive month.

“This helps offset the fact that the north did not share in the broader uplift in permanent hiring seen across the UK. It is also encouraging that pay for both permanent and temporary workers in the north continued to increase.”

She added: “Government, business and trade unions must act to shore up this fragile momentum in the job market. This is not the time to take the job market for granted.

“Instead, government should follow through on its commitment to lessen burdens on business. This means greater pragmatism on the employment rights agenda, including lessening the gamble the Government is taking with its guaranteed hours policy.

“It also means delivering an Autumn Budget that demonstrates the Government is serious about backing business and provides employers with the confidence they need to hire, invest and grow.”