Recruiters’ results reflect fears for jobs market
Uncertainty about the economy continues to rock the jobs market as three FTSE 250-listed recruiters reported reduced fees and earnings this week.
Hays gave an update today on its first quarter that ended on 30 September, showing a decline in net fees of 11 per cent in the UK, against a 7 per cent fall globally.
On Tuesday, Robert Walters gave an update on its third quarter that ended on 30 September, indicating a fall in net fees in the UK of 13 per cent against 17 per cent overall.
And PageGroup reported a fall in UK gross profit of 18.9 per cent to £30.3m on Wednesday.
Today Hays shares stand at 103p against a 52-week high of 130p; Robert Walters at 380p, compared with a 52-week high of 620p; and PageGroup at 411p against a 52-week high of 501p.
Alongside the falls in profits and fees, there has also been an increase in temporary rather than permanent recruitment.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said the rise in temporary employment came as no surprise due to economic uncertainty and inflationary pressures.
“With a recession still potentially looming ahead, firms are cautious about what the future may hold, and are filling gaps in their workforces with more temporary staff,” she said.
London showed the highest growth rate in temporary placements in September, according to a KPMG jobs report.
“Being hired on multiple temporary contracts cannot only affect short-term financial security but can also dent worker’s resilience in later life as it can disrupt saving for a pension,” Streeter said.
There is concern about the months ahead and the biggest rise in overall vacancies was within the medical, nursing and care fields, she added.
A total of 71 per cent of UK businesses are suffering labour shortages, according to a CBI/Pertemps Employment Trends Survey.
Rain Newton-Smith, CBI chief executive, said: “It is crystal clear that while labour shortages are making it more important than ever to focus on productivity, they are also making it harder to invest and grow, stifling the economic transformation needed to deliver sustainable growth.”