WILTSHIRE, UK. February 6th, 2026 – Newly released 2026 salary and labour market data highlights growing pressure on employers and workers across the South West, despite a stabilising national economic outlook.
The findings published by CMD Recruitment reveal continued wage constraints, lengthening hiring times and rising retention risks, according to its latest South West Salary Guide.
Operations Manager, Dan Barfoot who has more than 20 years of experience in the recruitment sector, explained:
“The data shows a labour market that is still highly pressured, particularly in the South West where pay trails national averages. Employers are facing longer hiring times, shifting candidate expectations and upcoming policy changes that will affect reward structures. Having access to clear, region-specific salary data is becoming essential for making informed workforce decisions.”
The data shows that the average salary across the South West currently stands at £37,195, remaining below the UK average, while unemployment remains low at 3.3%.
At the same time, UK vacancies have declined by 12%, and the average time to hire has increased to eight weeks, nearly double that of the previous year.
The 2026 Salary Guide presents updated salary benchmarks across a wide range of sectors, including engineering, industrial and driving roles, IT, HR, accountancy and finance, sales, marketing, design and SaaS.
Candidate expectations also continue to evolve, according to the new data. The guide reports that 80% of workers now want more paid time off, 84% consider bonuses a key part of total compensation, and 67% rank healthcare as the most important workplace benefit.
In addition, 47% of UK office workers are considering a career change in 2026, with nearly one in five already having decided to move roles.
“All these signs suggest the job market is slowing down and getting tougher, especially for those highly skilled roles. Employers may find that securing and retaining talent requires more flexible work and smarter plans for pay and staffing in 2026.” Dan added.
From 2029, National Insurance relief on salary sacrifice pension contributions will be capped at £2,000 per year with salary sacrifice schemes having typically increased pension value by between 8% and 12% for many employees in the South West, helping employers to offset lower regional pay levels.
The data indicates that changes to this system may reduce the overall value of reward packages unless employers adjust their approach.
The guide also examines the potential impact of proposed employment reforms, including the introduction of Day One Statutory Sick Pay from 2026.
CMD Recruitment’s analysis suggests this change may increase costs and administrative requirements for permanent hiring, particularly in sectors with higher levels of short-term absence.
As a result, the data points to increased use of temporary and contract workers across industries such as logistics, care and manufacturing.
The guide highlights the growing role of artificial intelligence in recruitment. The findings show that 84% of HR teams plan to increase their use of AI tools in 2026, with AI expected to manage up to 30% of routine recruitment tasks.
Organisations using AI-supported hiring processes are reporting reductions in time-to-hire of between 25% and 50% as many employers are increasing oversight of AI tools to address ethical and compliance considerations.
CMD Recruitment states that the guide is intended to give employers, HR professionals and jobseekers a clear view of current market conditions and emerging risks.
The company adds that organisations which respond early to changes in pay expectations, benefits and workforce models may be better placed to retain skills and maintain workforce stability through 2026.
ENDS