The term fractional has exploded in use. But what does “fractional” mean and why has it become so popular?
IPSE, the UK’s self-employment association, states that the term fractional has really exploded in use over the last five years in the U.S. and more recently in the last couple of years in the UK and Europe.
So what does fractional actually mean?
The fractional model offers growing businesses access to senior leadership on a flexible, part-time basis without the cost, commitment or risk associated with a full-time hire. It provides an opportunity for businesses to access talent, experience, skills and leadership that they otherwise couldn’t afford at their current growth stage.
What’s driving this growth?
- Uncertainty over the economic outlook and government policy.
The KPMG and REC UK Report on Jobs, September 2026 – based on data collected 12-24 August 2026 – found temporary / interim staff billings expanded for a fifth consecutive month, posting the second-quickest growth rate in over three years, while permanent placements rose only marginally and for the first time since September 2022. “Employers have favoured flexible temporary hires to support their investment plans” since spring 2026, said Jon Holt, KPMG’s Group Chief Executive, with permanent hiring resuming only modestly amid continued uncertainty over the economic outlook and government policy. - The cost of a full-time hire in the UK has risen sharply and specifically for employers.
From 6 April 2025, UK employer National Insurance rose from 13.8% to 15%, and the earnings threshold at which employers start paying it fell from £9,100 to £5,000 (HM Treasury’s Autumn Budget 2024, analysed by Deloitte). - A persistent, self-reported leadership and access gap at UK scaling businesses.
The ScaleUp Institute’s Annual Review 2025 found 55% of UK scaleup CEOs cite talent and leadership as a critical barrier to scaling – the fifth consecutive year it has ranked as a top-cited barrier – with roughly six in ten wanting help accessing Non-Executive Directors and fractional executives specifically, and shortages named particularly in sales, business development and marketing leadership.
When does fractional make sense?
EY’s research found mid-market companies’ primary stated reason for using flexible talent is fuelling growth (58%), versus cost control for large companies (62%).
IPSE frames the same pattern from the supply side: fractional growth in the UK has come from “small businesses, start-ups and scale-ups who can benefit from the skills and experience of senior leadership but don’t have the time, resource and budget for a full-time role.”
In our experience the model works best for time-poor, resource-light businesses who are looking to scale, plan for an exit, cover a senior leader absence or reduce founder dependency within their organisation.