More Candidates, Fewer Vacancies – So Why Is Hiring Still Difficult?

There are finally some signs that the UK recruitment market may be starting to turn a corner.

The latest KPMG and REC UK Report on Jobs found that permanent staff appointments increased in August for the first time since September 2022. Temporary recruitment also continued to grow, with temp billings increasing for the fifth consecutive month.

After a prolonged downturn in permanent recruitment, that's welcome news.

But look beneath the headline and the picture becomes much more interesting.

There are more candidates – but fewer vacancies

While permanent placements have started to increase, overall vacancies are still falling.

At the same time, the number of people looking for work continues to rise, driven partly by redundancies, fewer job opportunities and concerns about job security.

On the face of it, that should make recruitment easier.

More candidates + fewer vacancies = employers having their pick of the market.

Except that isn't necessarily what is happening.

Starting salaries increased at their fastest rate since January, with recruiters reporting continued competition for highly skilled and niche candidates.

That points to an important distinction:

A shortage of candidates isn't necessarily the problem. A shortage of the right candidates is.

Engineering tells an interesting story

For businesses in engineering and manufacturing, the figures are particularly noteworthy.

Engineering and Accounting/Financial were the only two of the ten sectors monitored by the survey to record an increase in permanent vacancies during August.

This comes after several months in which engineering has repeatedly been among the stronger areas of the recruitment market.

So while overall UK vacancies continue to fall, employers looking for engineering skills may find themselves operating in a very different market.

More applications don't automatically mean better recruitment

For SMEs, a candidate-rich market can create its own problems.

Advertise a vacancy and you may receive dozens, potentially hundreds, of applications.

Someone then needs to identify which candidates genuinely have the skills, experience and attitude the business needs.

Poor recruitment decisions are expensive. But traditional recruitment fees can also feel disproportionate, particularly for smaller businesses watching costs carefully.

There needs to be another option.

Recruitment shouldn't become more expensive just because the right person is difficult to find

At 4Front Recruitment, we believe SMEs should be able to access professional recruitment support without automatically committing to traditional percentage-based recruitment fees.

Our Managed Recruitment service provides a different model.

For a fixed fee of £799, we manage the recruitment process and help businesses identify the strongest candidates for their vacancy.

It means businesses can benefit from recruitment expertise while retaining control of their hiring costs.

And in a market where candidate numbers are increasing but specialist skills remain valuable, that matters.

The recruitment market may be changing again

The latest figures don't suggest that the UK jobs market has suddenly returned to rapid growth.

Far from it.

Employers remain cautious, vacancies continue to decline and economic uncertainty hasn't disappeared.

But permanent hiring increasing for the first time in almost four years is significant.

Businesses that have delayed recruitment may gradually start moving again.

And when they do, the challenge won't simply be finding a candidate.

It will be finding the right candidate – at the right cost.

That's exactly where 4Front can help.

Looking to recruit? Talk to 4Front about a smarter, more cost-conscious approach to finding your next employee.

Source

This article draws on the KPMG and REC UK Report on Jobs, September 2026, compiled by S&P Global from responses to around 400 UK recruitment and employment consultancies. The September report covers recruitment activity during August 2026.

KPMG: KPMG and REC, UK Report on Jobs September 2026 – Permanent placements increase for first time in nearly four years.

REC: Report on Jobs: Permanent placements increase for first time in nearly four years.