Birmingham’s Hiring Landscape: Flexibility, Skills and Cautious Confidence

An economic outlook for 2026
By Gareth Watkins, Performance Director, SF Recruitment

After more than two decades recruiting across Birmingham, I have seen the city navigate many economic cycles. The current hiring landscape, however, feels particularly complex. Employers are balancing uncertainty with the need to maintain momentum, and that tension is shaping how and when organisations choose to hire.

A more cautious approach to permanent hiring

Since the rise in Employers’ National Insurance, many businesses have become more hesitant to create new permanent roles or replace leavers. Economic uncertainty is encouraging organisations to pause long-term hiring decisions, and as a result, the market for permanent recruitment has softened.

At the same time, we are seeing a clear and sustained rise in temporary and interim hiring. Employers are increasingly using flexible workforce solutions to support short-term projects, manage change, or bridge skills gaps while maintaining agility. This approach allows businesses to remain operational without committing to long-term cost increases, and it is a trend that shows no sign of slowing.

Skills in demand: digital, data and engineering

Birmingham’s technology sector continues to expand, driving consistent demand for digital, data and AI-related skills. Organisations are investing in people who can help them use technology more intelligently, improve efficiency and support innovation.

Engineering remains another area of persistent skills shortage, reflecting the national picture. While the region’s industrial heritage remains strong, sourcing experienced technical professionals continues to be a challenge.

Professional services, financial services and technology are among the most active hiring sectors. In these markets, salary pressure is increasing as demand continues to outpace supply. Employers are no longer competing on pay alone; culture, flexibility and clear progression opportunities are now central to attracting and retaining talent.

What employers and candidates are prioritising

Hiring senior, strategic or technical professionals has become increasingly competitive. Many of the strongest candidates are choosing to wait for the right opportunity rather than moving reactively. Employers offering well-rounded propositions — combining competitive remuneration, meaningful flexibility and positive working environments — are consistently more successful.

Candidate expectations have also shifted permanently since the pandemic. Flexibility remains one of the most valued benefits. For many working families, hybrid working underpins childcare and daily routines, and any reduction can be a deal-breaker. Even in predominantly office-based roles, flexibility around start and finish times is now seen as a minimum standard.

Holiday entitlement has followed a similar pattern. Twenty-five days plus bank holidays has become the baseline expectation, with anything less having a noticeable impact on attraction.

A resilient city with reasons for confidence

Looking ahead to 2026, Birmingham businesses remain understandably cautious. Cost-per-hire has increased, and a subdued economy has prompted many organisations to reassess workforce plans. Yet beneath this caution sits resilience.

Birmingham’s strength lies in its diversity — shaped by its multicultural population, supported by its universities, and driven by a broad range of sectors that extend well beyond its manufacturing roots. Its central location and connectivity continue to make it attractive to both investors and skilled professionals.

A city built on industry and now thriving on innovation, Birmingham has repeatedly shown its ability to adapt. Even in uncertain conditions, there are strong reasons to be confident in its continued ability to attract talent, evolve and grow.

To discuss your plans for the year ahead, please contact Gareth Watkins