What the latest ONS data tells us about the recruitment market

The ONS published its latest labour market statistics on 16 January, including PAYE Real Time Information (RTI) data. As expected, December proved to be a quieter month for recruitment.

Our Bullhorn data shows that permanent hiring fell sharply compared with November and remained flat year on year. Contract recruitment, however, held up better and continues to show stronger growth compared with last year.

So how does this compare with the official data?

(Note: contractors will be included in ONS/HMRC figures if they are paid via payroll.)

Vacancies remain steady but slow

ONS estimates suggest UK vacancies rose slightly between October and December 2025, increasing by around 10,000 to 734,000. However, vacancy numbers remain significantly lower than a year ago, with declines across most sectors. This mirrors APSCo’s own findings, which show permanent vacancies across highly skilled professional roles have remained broadly static.

More people looking for work

The number of people on payroll fell to 30.2 million in December 2025, down 0.6% compared with last year. One exception was health and social care, which saw employment increase during the month. The employment rate held steady at 75.1%, while unemployment rose to 5.1%. Economic inactivity remained relatively high at 20.8%.

APSCo analysis suggests this increase in unemployment is partly driven by more previously inactive people entering the job market. However, many continue to face challenges finding work due to a mismatch between their skills and the roles available.

Pay growth stabilising

Pay growth continued to ease towards the end of 2025. Regular pay grew by 4.5% and total earnings by 4.7% year on year. Once inflation is taken into account, real pay growth remained modest.

APSCo’s view

Overall, the data paints a picture of a market that remains tough, particularly for permanent hiring. Candidates and vacancies are not always well aligned, but there are some encouraging signs. Recruiters appear to be working more efficiently, with fewer CVs required per placement — potentially supported by greater use of automation and smarter candidate matching.

Read our latest Bullhorn Recruitment Trends snapshot here.