Temporary Vs Permanent: What's best for your business?

BY Emma Thelwell   |  

For the fifth consecutive month, temporary job postings have increased in the UK. This month the UK Government published the most recent numbers, revealing that in January 2023, there are over 200,000 more workers on temporary contracts than in January 2020 – totalling1 1.66 million.

At2 3.8%, the UK is currently enjoying the lowest unemployment rate since 1974, and a record number of open permanent positions are available. So then, why are temporary contracts on the rise?


Understanding The Data

All regions of the UK aside from the Midlands reported an increase in temporary hiring, with the midlands reducing the number of temporary workers. We've seen the most prominent spike of hiring temporary workers in the Nursing, Medical, and Care industries, closely followed by Accounting/Financial and Secretarial/Clericals industries.

On one hand, this change indicates how employers are still confidently making hiring and investment decisions in their businesses despite the uncertainties in the country's economy. But on the other hand, it also emphasises how crucial temporary agency employees can be to operate those businesses depending on the business's needs efficiently. Therefore, there could be numerous advantages to short-term employees.

Ultimately there is no 'one-size-fits-all’ approach to hiring in a business, so the real trick is understanding if temporary, permanent, or a combination of the two is best for your business at the time.

The real question is: What should a business like yours do in the current market scenario?


Permanent or Temporary Hiring: What Works for Your Business?

Let us share some benefits and drawbacks of temporary and permanent hiring that can ease your decision-making.

Pros of temporary hiring

  • Immediately available workforce
  • Generally, more flexible with hours and days
  • 'Try before you buy' approach.

Cons of temporary hiring

  • Zero-hour contracts
  • Uncommitted workforce
  • No time to replace/payroll.


Whilst temporary workers suit businesses during peaks and troughs of work – including aviation, logistics and other areas where demand can be seasonal/inconsistent.

If your business hires temporary employees, it could run into problems with benefits and attrition rates. Yet, some advantages can ultimately outweigh these drawbacks, it all comes down to your business needs.

Pros of Permanent Hiring

  • Committed workforce.
  • Reduced Attrition
  • Ability to train and develop internally.

Cons of Permanent Hiring

  • Does not provide flexibility during seasonal/ demand hiring.
  • High investment with a chance of movement
  • It can be harder to attract.

One of the most stable ways to hire in the UK is permanent hiring, but an employer faces challenges due to employees' ongoing expectations. Every coin has its flipside, so it depends on what your business requires before hiring permanent or temporary employees.

The recent (and still ongoing) discussions about four-day working weeks and Hybrid working are just a couple of examples of an ever-changing market.


Why are Temporary hires on the rise?

Temporary employment has been around for a long time. With over 1.66 million people currently working in temporary positions in the UK, there is no denying the depth of this resource. In contrast, there has been a dramatic shift in the motivations behind accepting and recruiting for temporary positions. Employees desire and need more and more workplace fluidity, flexibility, and choice. Businesses are now skilled at acting rapidly to fill a need, particularly during the winter and when the economy isn't helping anyone.

We don't have any conclusive evidence, but from reviewing the data, the anomaly roles appear to be where there is a skills gap in the market. So, when the permanent hires aren't there, the positions are being taken by two members with a lower skillset to ensure the work is complete – with any luck, those people are being trained to take a permanent position.

One of the reasons that came into the limelight for businesses looking to hire more temporary workers was the uncertainties surrounding the Covid problem and Brexit.

Also, it is assumed that because of the unpredictability of the economy, permanent employees were becoming less likely to look for new jobs or change careers.

All things point to the economic 'doom and gloom', where we are all being told a recession is on the horizon – yet we haven't seen it get any closer. Nervousness in the market will drastically affect hiring decisions, companies will have plans in place should a recession hit, and 9 times out of 10, there's some reduction in staffing.

We can't predict the future; we can remind you that if the tornado doesn't seem to be getting any closer – it's either heading straight for you or moving away.



The truth is that there are pros and cons to both temporary and permanent hiring, depending on the business's needs. However, determining the requirements is the first step in successfully developing and maintaining adequate staff, regardless of whether you choose a temporary or permanent employee to fill your vacancy or a combination of both.

In some positive news, here at MBA, we aren't seeing any signs of slowdowns in the market and have only noticed a slight uplift in temporary vacancies, with no impact on Permanent. But, of course, we're always interested to know what others are seeing first-hand, too – please comment on our LinkedIn post with your views!

Let us know what you think.


End Notes
  1. https://www.statista.com/statistics/530216/temporary-workers-in-the-uk/
  2. https://www.ons.gov.uk/employmentandlabourmarket/peoplenotinwork/unemployment


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