The wider labour market has cooled. The Low Pay Commission's 2025 report describes conditions as 'low hire, low fire': recruitment is weaker, vacancies have dropped below pre-pandemic levels, and redundancies have risen only slightly. So teams aren't shedding people, but they aren't opening the floodgates either.
Software is a mixed picture within that. Computer Weekly's tech recruitment outlook for 2026 notes that against a subdued 2025 backdrop, businesses stayed cautious on hiring, yet clear demand hotspots remain for specialist skills: AI, data, enterprise applications and cyber security. And there are pockets of growth. The ONS vacancies bulletin for November 2025 found the largest volume rise in vacancies over August to October 2025 was in professional, scientific and technical activities, up by 5,000.
The gap between top and average pay is widening too. The Migration Advisory Committee's review of IT and engineering professionals reports that leading technology firms can pay sizeable wages to skilled migrants, pushing pay for the most in-demand roles far above the salary threshold, while engineering pay on the Skilled Worker route sits broadly in line with the UK average. For a lean team, that means the roles you most need are often the ones that cost the most to fill well.
Demand is concentrating around a handful of specialisms. Accenture data reported by The Register shows demand for AI skills rose nearly 200% in a year, with London accounting for 80% of AI-related job postings and close to two-thirds of all UK technology vacancies. That is a sharp pull towards one skill set and one region.
Cyber security is another pressure point. GOV.UK's cyber security skills report for 2025 counts roughly 143,000 people in the UK cyber workforce, with growth accelerating from 2% in 2022 to 5% in 2024. Yet the AI Labour Market Survey 2025 notes that 70% of cyber firms reported at least one hard-to-fill vacancy. Core technical roles are stretched as well: the Occupations in Demand 2025 data places IT business analysts, architects and systems designers, some 193,000 workers, in critical demand.
The other side of the story is the entry-level squeeze. techUK, citing Adzuna reports a 30% drop in UK entry-level job postings since ChatGPT launched, with graduates facing the toughest market since 2018. The Register, using Institute of Student Employers figures adds that UK tech graduate jobs fell 46% in the past year, with a further 53% drop projected. One hopeful counter-trend: the DSIT AI Labour Market Survey 2025 shows apprenticeships climbing from 3% of AI hires in 2020 to 19% in 2025, as firms build skills a different way.
Start by naming the one or two roles that genuinely move your product forward. When budget is tight and specialist pay is rising, spreading it thinly across junior and mid roles rarely pays off. Put your spend where the demand hotspots Computer Weekly identifies, AI, data, enterprise applications and cyber, actually match your roadmap.
None of this means hiring more people. It means hiring the right person for each priority role, and giving each search the time and precision it deserves. A lean team lives or dies by its next few hires.
This is where we come in. We search a database of 15 million candidates to find the specialist you actually need, and we manage the recruitment end to end so a small team isn't buried in screening and scheduling. Our recruitment agent manages recruitment end to end for 8% on a successful hire, with no monthly fee and no upfront cost. If you're hiring for a role that has to land, tell us what good looks like and we'll get to work today.
