The recruitment industry is ever-competitive and evolving rapidly. If you’re considering starting your own agency it’s a good idea to understand how the market is looking, and the opportunity available to you.
We’ve put together the most important statistics about the size of the recruitment industry and the challenges faced by recruiters today, to put you in good stead.
1) The UK recruitment industry is currently valued at £43 billion.
According to APSCo, the UK recruitment industry is currently valued at £43 billion.
While 2025 marked the first post-pandemic drop, with the industry value dipping by 3%, the overarching sentiment for 2026 is one of resilience.
Despite persistent hurdles like candidate shortages and smaller margins, high-growth pockets are emerging in specialist fields such as AI engineering, cyber security and renewable energy.
2) According to estimates, in 2025 recruiters filled 21.8 million temporary and permanent roles.
Following the 25.7 million placement peak reported by the REC in 2022, 2025 market indicators suggest a drop toward the 21.8 million placement mark, reflecting a shift from the 2022 pandemic recovery to more strategic hiring.
3) There are an estimated 30,000 recruitment agencies in the UK.
The RISR counted 30,035 recruitment agencies in the UK in 2022. The findings showed a 6.5% increase on the previous year, and a total of 201,154 people working in UK recruitment agencies. 79.5% of these agencies are micro-businesses with fewer than 10 employees.
4) Only 16% of all recruitment agencies were in existence before 2008.
According to data from Companies House, the number of recruitment agencies operating in the UK has grown on average 27% per year, since 2008. This was triggered by the fallout of 2008’s global financial crisis and the resulting rise of unemployment. The industry remains resilient despite the economic instability of the past few years.
5) Almost a third of the UK’s recruitment agencies are located in London.
The capital unsurprisingly has more recruiters than anywhere else in the country, with 31% located in the region. Manchester takes second place, with 2,749 recruitment companies, according to BoldData. Hertfordshire also has a large number of recruitment agencies, making up 3% of the country’s total.
6) The average number of active job postings in 2025 was between 1.4 and 1.7 million.
Data from the REC’s Labour Market Tracker shows that while the record-breaking surge of 2023 (which saw postings peak at over 2.3 million) has cooled, the market remains structurally active. Throughout 2025 and into 2026, weekly unique job postings have averaged between 1.4 million and 1.7 million.
7) The unemployment rate in 2025 showed an upward trend, reaching 5.2% by the end of the year.
The latest data from ONS represents a five-year high. Youth unemployment in particular was significantly higher at the end of the year, sitting at 16.1%.
8) Average weekly earnings have increased by 5.3%.
Reports show that public sector salaries grew more significantly at 9.3%, compared to those in the private sector at 5.4%. The average annual salary for a full-time employees rose to £39,039 in April 2025, from £37,439 in April 2024.
9) 56% of recruitment agencies cite talent as their top challenge.
Tight talent pools continue to be the top challenge for recruitment agencies. At 56%, this figure sits 10% higher than last year, in which tight talent pools were voted as the largest problem for 46% of agencies.
In response to this issue, recruitment professionals reported that they plug the gap by engaging with passive candidates.
10) New positions take an average of 40 days to fill.
The Employment Law Solicitors report an average time to fill a position of 40 days. However, this is dependent on the industry. For example, hiring for a position in the engineering industry can take as long as 62 days. As a recruitment business, you’ll know that it’s worth the wait when you place the perfect candidate.
11) 70% of recruitment agencies are using AI and recruitment automation.
When we first reported on AI use in recruitment in 2022, 11% of recruitment businesses were making use of AI tools. This has now risen to 70%, judging by data gathered by StandOut CV. However the British Chamber of Commerce reported that 48% of SMEs they spoke with had no plans to implement AI, to avoid devaluing the industry and the role of the recruiter.
12) The current skill shortage in the UK is estimated to be costing businesses £6.6 billion per year.
Clients are no longer paying for a database search; they’re paying for a recruiter’s ability to act as a Headhunter and Career Consultant. Those who can successfully navigate this shortage are able to maintain premium margins, even as overall hiring volumes stabilise.
13) A ‘bad hire’ of a candidate at manager level will cost a business more than £132,000
The cost of a bad hire as reported by the REC can’t be underestimated. This figure includes money wasted on training, lost productivity, exit fees and the cost of having to find a replacement!
Using this figure can be a powerful way to sell the benefits of using a recruitment partner to get the right person first time.
With these recruitment industry statistics under your belt, you’re well on your way to a comprehensive understanding of the market today. Here at New Millennia, we specialise in supporting recruitment start-ups and more established agencies with back office support and 100% recruitment funding.
To find out how we can help you, give us a call on 0161 337 9882 or email enq@nmgroup.co.uk.
