Boards are keeping more of the interim leaders which they bring in. Executive Recruit’s own placement data, taken from its UK search assignments, shows a 12% rise over the past 24 months in executive interims moving into permanent senior roles. In my experience, that reflects a shift in how boards use an interim appointment. They are filling a gap and assessing a candidate at the same time, then deciding on the permanent role once they have watched the work. Taking a close look at the market, it shows that too many organisations still treat the assignment as a stopgap and lose people they should be keeping.
The UK permanent hiring market declined for 45 months in a row. That run ended in July 2026, when the KPMG and REC, UK Report on Jobs recorded the first month without a fall in permanent placements since autumn 2022. Temporary billings moved the opposite way for most of that period. In July they grew close to their strongest rate in three years, and demand for short-term workers rose for the first time in two years.
Many boards read the headline figures as proof that senior hiring had stalled, however, it had not. Organisations kept appointing leaders throughout the downturn on temporary terms, and a growing number of those appointments have since turned permanent. The Office for National Statistics put the UK temporary workforce at around 1.59 million in the three months to May 2026, up on the year. Flexible working has also moved further up the organisation, and the boardroom is no exception.
Why interims are choosing permanence
The first driver comes from the interim executives themselves. Contracting has always offered control over which problems a leader takes on, but never paid leave, pension contributions or income between assignments. Running a portfolio career also now takes more administration than it used to, with gaps between mandates that grew longer through the hiring freeze. Guaranteed income and a pension carry more weight than they did three years ago.
In my experience of placing senior leaders, the shift goes beyond money. An interim arrives with a fixed mandate and no stake in what happens after it ends. That detachment produces the straight-talking that boards value in interim leadership, because bad news from someone with no promotion to protect tends to be accurate news. It also becomes harder to sustain once the mandate expands, and the leader starts to care about the outcome. At that point, the appeal of finishing the work outweighs the appeal of the next assignment.
Why employers are converting
The second driver comes from employers, and it is the stronger of the two.
A permanent appointment made through a conventional hiring process rests on interviews, references and assessment, while an interim appointment that has run six or nine months rests on delivered work. Boards that have watched a leader hold a business together through a hard period do not want to hand that person back to the market and run a search for a candidate they know far less about.
From 1 January 2027, the Employment Rights Act 2025 cuts the qualifying period for unfair dismissal from two years to six months and removes the cap on compensatory awards. Anyone who started on or before 1 July 2026 is over that threshold the day it takes effect. The window for a board to correct a senior permanent appointment narrows sharply and the cost of getting one wrong is no longer capped. Evidence built up over an interim period becomes the most defensible basis a board has for a permanent decision.
What conversion costs
Employers who want to convert an interim have to pay for it. An interim day rate does not translate into a base salary, and a leader who has proven their value over nine months knows what that value is worth. The offers that work include long-term incentive plans with vesting tied to performance, not just tenure, plus retention terms set outside the standard pay grade structure. Boards that put a standard offer in front of a proven interim tend to lose them, then run a search to replace someone who was already in the building.
Where the market gets this wrong
Too many executive search processes still treat conversion as an outcome to deal with at the end rather than something to plan for at the start. Interim and permanent mandates still run through separate desks, on separate fee structures, with incentives that pull against each other. A transition that should be straightforward turns into a negotiation nobody prepared for, conducted when the organisation needs a decision and the leader has other options on the table.
The fix is simple, and my view on it has not changed. Whether the interim converts to a permanent role, returns to their substantive position or exits cleanly must be agreed in writing by both parties on day one, not negotiated at the end when everyone is tired and the organisation needs to move on. A conversion fee, a notice structure and a clear position on equity belong in the first conversation, before anyone has anything to defend.
The direction of travel
The Institute of Interim Management examined fractional interim management for the first time in its 2026 survey, a sign of how far senior working patterns have moved beyond the choice between permanent and temporary. That direction will hold. Permanent hiring has stabilised rather than recovered, and organisations that spent three years managing risk through flexible senior appointments have no reason to abandon a model that worked.
Boards that treat an interim appointment as a holding measure will keep losing capable leaders at the close of assignments they could have converted. Boards that treat it as the opening phase of a permanent decision will appoint on evidence rather than on inference, and they will make better appointments than a conventional search would have produced.
Mark Geraghty is a Partner at Executive Recruit, a specialist executive search firm operating across the UK. He advises boards on senior leadership appointments, succession planning and interim management.
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