The Big Picture
It will surprise nobody to hear the employment market has been tough for a while now. The headwinds are well known: geopolitical instability, high inflation and low growth, a large budget deficit, cautious business outlook, increased costs of hiring – the list could go on.
Despite this, the UK economy’s performance has been much like a mid-range pillow: soft, but not quite down. Growth has been less disappointing than anticipated[1][2], and it appears reports of the UK’s productivity death were greatly exaggerated.[3][4]
Similarly, there are signs of life in the job market – the latest REC/KPMG report highlights a rise in permanent placements (the first since Sep 2022), while temp billings marked a fifth consecutive month of growth.[5]
Nevertheless, a big picture view always obscures nuance. Different sectors face different challenges and opportunities, which don’t always sit neatly in a macro summary.
This article is an attempt to look beyond the headlines and answer the question: “how are the sectors that we serve faring?”
Non-profit
Sentiment
In what will no doubt feel like a familiar entreaty for a sector where spending is highly scrutinised, non-profits are being asked to do more with less.
The latest accounts data shows that two in five charities spent more than they received[6], with smaller charities bearing the brunt of the struggles. In keeping with the experience of households and organisations throughout the UK, ever-rising costs present another challenge. The rise in National Living Wage in April and last year’s employer NI increases have had a particular impact on budgets – making it more expensive to hire and retain staff.
Meanwhile demand for services shows no let-up: 83% of charity leaders reported rising demand in Charities Aid Foundation’s latest survey, and 86% expect it to grow further.[7]
Despite these impediments, the ever-resourceful third sector appears to be holding up resiliently: CIPD’s summer survey found the voluntary sector to have the strongest employment intentions of any sector, well ahead of the private and public sectors.[8]
Job market dynamics
As is covered in the full report, we have used vacancy rates as a key data point in assessing job market dynamics, though for non-profits we have had to look beyond ONS data.
Briefly, the vacancy rate is the number of unfilled job vacancies divided by total jobs (both filled and unfilled). A high vacancy rate indicates a tight labour market, where job vacancies are abundant relative to people. Conversely, a low vacancy rate means lower demand for staff. Vacancy rate is therefore one of the clearest barometers for how employer demand stacks up against employee availability.
With no ONS series for charities, the DfE’s Employer Skills Survey is our closest guide. Unfortunately, it is difficult to directly compare the two datasets for two reasons: i) the latest DfE data is from 2024, and ii) the methodologies are different.
Nevertheless, the vacancy rate for charities appears to be broadly in line with what we can see in the economy-wide ONS data: namely, that hiring demand has been on a downward trajectory since the highs of the post-COVID recovery.
Somewhat more up-to-date (though sample size-limited) data from TPP Recruitment shows advertised roles in Q1 2026 were materially lower than a year earlier, along with applications to vacancies – which were down 58% from Q1 2025.[10] Interestingly, supply of permanent and temporary staff appears to be moving in different directions: while permanent candidate availability was down 14% quarter-on-quarter, temporary availability was up 10% – perhaps signalling a preference for (or acceptance of) flexible work, and/or a migration of permanent staff towards other sectors.[10]
While the non-profit job market has had a rough ride recently, things may be improving. Charities are twice as bullish on hiring intentions as the wider economy. With supply of perm staff tightening, and budgetary pressures restricting the ability to attract via increased starting salaries, we may see a greater emphasis on temporary staffing in the non-profit sector.
Non-profit: the bottom line
Charities are being asked to do more with less: costs are rising, many are spending more than they receive, and demand for their services keeps growing. Even so, the sector reports the strongest hiring intentions of any sector. With permanent candidates becoming scarcer, the balance is tilting slightly towards jobseekers.
For employers: expect permanent hires to take longer. Temporary and interim staff offer a flexible bridge, and where budgets limit pay rises, flexibility, purpose and development will have to do more of the heavy lifting.
For candidates: this is one of the more encouraging markets around. Applications have fallen sharply, which may mean less competition for each role, and temporary work can be a practical route in.