As we move into the tail end of what has been another challenging year, Rialto analysts bring you our latest quarterly insight into the executive job market, emerging growth areas and risks, and ask what executives should focus on to stay relevant and/or repivot.
We are seeing a very definite shift in the executive market across the globe from legacy functions and sectors to emerging technologies, regions and digital transformation, and big trends of automation and restructuring.
Rialto director Richard Chiumento said: “This is a real tightening of the market which is being reset. We are seeing a tsunami of restructuring announcements. This is not cyclical, it’s structural. I fear many executives and senior leaders have not yet grasped the direction in which we are headed.
“Generative AI, Agentic AI, and fast-evolving Artificial General Intelligence, which will add human-like cognitive capacity to technology, will wipe out and/or disrupt millions of jobs in the next few years. The process is underway already.
“For those who embrace this revolution, the future looks exciting and full of opportunity. For those who feel intimidated by it or are avoidant, it is going to need a new strategy to survive & thrive.”
The economy flatlined in July, following 0.4% growth in June, a continuing trend of month-by-month volatility.
The ONS attributed the July slowdown to a 0.9% fall in production, particularly in manufacturing, which offset gains in services and construction.
Services such as health, IT, and business support held up well, offering some resilience.
Most forecasters expect modest GDP growth in Q4, but at a slower pace than earlier in the year. The Bank of England and the OECD suggest around 0.1–0.2% through the end of 2025.
Looking to 2026, the Office for Budget Responsibility and IMF suggest the UK will expand by roughly 1% in 2026, weaker than the G7 average, as the effects of higher taxes and slower productivity gains weigh on output. The Resolution Foundation warns that real household disposable income will be squeezed again unless inflation falls faster than expected.
The UK’s goods deficit increased by £3bn to £61.9bn in the three months to July, though exports were beginning to rise again at the end of the period and the UK was saved from the worst of US President Donald Trump’s tariffs chaos.
The Consumer Prices Index rose by 4.1% in the 12 months to August 2025, down from 4.2% in the 12 months to July but still twice the Bank of England target.
Interest rates remained unchanged at 4%, remaining cautious until inflation falls, but two of the nine Monetary Policy Committee members voted for a 0.25% cut.
This all adds to the fiscal bind Chancellor Rachel Reeves faces, as debt servicing costs climb and demands for higher public spending persist. That infamous £22 billion blackhole appears to have expanded into a £40 billion one. Something’s got to give.
UK government borrowing rose to a five-year high in August, up £3.5 billion in just a month to £18 billion, raising the spectre of tax rises in the Budget.
Despite the gloom, there are limited areas of strength. Digital and IT services remain buoyant, with computer programming and support services growing steadily. Construction and engineering have shown resilience, aided by infrastructure spending commitments. Importantly, real wages are still rising, albeit more modestly than of late, giving households some buffer against cost pressures.
While the economy feels “stuck,” as Treasury officials admit, the UK retains pockets of dynamism. For executives and businesses, success in 2026 will hinge on aligning with these growth niches and embracing emerging technologies while weathering a period of slower overall expansion.
The latest data shows vacancies have fallen for 23 consecutive months, and they are falling more quickly. According to the ONS, they dropped 119,000 in June–August 2025 on the previous year, (-14% ) and are now 8.4% below pre-pandemic levels. The fall was steeper for permanent roles and in the southeast of England. Decline was seen in half of UK sectors. The number of unemployed people per vacancy was up to 2.3 in Q2 from 2.2 the previous quarter.
Vacancy numbers have now dropped compared with the previous three months for more than three years, and by around 571,000 since March to May 2022.
Payrolled employees in the UK fell by 142,000 (0.5%) in the year to July 2025, but were stable on the month and early estimates show they were likely to stay the same for August.
(NB ONS labour force statistics are acknowledged to be variable in accuracy.)
Employer caution around economic uncertainty coupled with waves of redundancies, many triggered by the impact of AI, drove the steepest upturn in candidate availability since November 2020, according to KPMG and REC’s report on UK jobs for August.
Earnings growth remains positive, nominally, at around 4.9%, but when adjusted for inflation, just 0.7%. Salaries increased faster in the public sector, 5.6%, compared to 4.7% in the private sector
Macro headwinds will continue to affect hiring pace, but pockets of executive demand remain. Firms are prioritising targeted senior hires rather than broad headcount expansion.
FTSE boardrooms continue moderate renewal while the drive for female representation and governance capability continues to shape NED recruitment and board agendas. Boards are meeting frequently and scrutinising strategy, risk and succession planning.
The EU unemployment rate was 5.9% and the euro-area rate 6.2% for July 2025, a modest monthly improvement and a small improvement year-on-year.
There was a contrast between the cooler north and hotter south. Postings in Germany and France have fallen 15% and 19%, respectively, over the past year, while vacancies in Spain and Italy were 46% and 53% above pre-pandemic levels, according to Indeed.
Demand for transformation, governance, sustainability and compliance skills strengthened as companies prepare for AI automation as well as stricter reporting regimes, while general hiring softened in more cyclical consumer sectors. Staffing and executive search data for Q3 show cautious employer sentiment but persistent need for specialised executive talent.
Professional and engineering roles tied to public sector or infrastructure spending were also strong.
With consumer demand slow, relevant sectors including leisure and retail are showing weak executive hiring.
Placements in non-specialist corporate support functions are facing downsizing as companies consolidate technology platforms and centralise operations.
Alongside traditional strategy and people skills, boards are asking executives to combine commercial judgement with the ability to deploy and govern generative AI and analytics-led decisions.
The outlook for Q4 is one of stability rather than expansion. Growth will be subdued but is not expected to collapse.
So, across the UK and the EU, a structural change in hiring and an accelerating decline in traditional sectors and functions continues apace, with opportunities in c-suite and senior leadership roles evolving to oversee successful digital transformation and ensure competitive performance to steer organisations through uncertainty and restructuring. AI literacy is a must for ALL executives, not just those in technology-heavy functions.
Organisations are investing in executive learning (digital, people leadership, AI governance). LinkedIn and other corporate-learning reports show rising demand for upskilling and role-readiness programmes targeted at leaders. Executives who are not developing their own skills will be left behind.
Q4 2025 promises to be a test of adaptability for executives. With vacancies continuing to decline, pay growth cooling and certain sectors softening, the edge will go to leaders who anticipate where demand remains strongest, can show measurable value, and remain flexible in their role expectations and compensation.
The challenge for executives is no longer just to ride out short-term cycles, but to pivot decisively toward growth niches including AI literacy and international relevance. Those who adapt their leadership narrative now will be best placed to turn today’s structural disruption into tomorrow’s opportunity.
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