Home Money Recruiter Hays hit by hiring slump in UK and Germany

Recruiter Hays hit by hiring slump in UK and Germany

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Business difficulties: Hays has become the latest British recruiter to report a worse result following a drop in hiring in the UK and Germany.
  • Hays revealed that its comparable net rates fell 15% in the last quarter

Hays has become the latest British recruiter to report a drop in fees following a drop in hiring in the UK and Germany.

The London-based company revealed its like-for-like net commissions fell 15 per cent in the three months to December compared to the same period a year earlier.

It recorded a 21 percent drop in permanent hiring rates, a 10 percent decline in temporary rates and double-digit percentage drops in many of its core territories.

Net rates fell 13 percent in Germany, where the economy just contracted for the second year in a row due to lower exports, growing competition from China and rising energy prices.

Hays noted that its clients were taking longer to hire people full-time, while the difficult German auto industry was impacting temporary hires.

Meanwhile, rates fell 14 percent in the British Isles amid much weaker trade in London, the north of England and the Republic of Ireland.

Business difficulties: Hays has become the latest British recruiter to report a worse result following a drop in hiring in the UK and Germany.

Outside Europe, the FTSE 250 firm saw falls of 14 percent in Australia and New Zealand, 26 percent in Latin America and 38 percent in Hong Kong.

Hays’ business update follows similar announcements from recruiters PageGroup and Robert Walters earlier this week.

Both companies reported that their gross profits fell in the fourth quarter of 2024 due to slow results in the United Kingdom and Germany, which they blamed on low customer and candidate confidence.

They have also continued to reduce staff numbers: Robert Walters reduced its workforce by 17 per cent to less than 3,000 last year. Hays reduced its own workforce by 15 percent over the same period.

Interest rate hikes by central banks since 2021 have made borrowing more expensive for companies looking to expand, causing many to implement layoffs or hiring cuts.

The global tech industry has been especially brutal, announcing more than 583,000 job losses since 2022, according to the tracking website Layoffs.fyi.

It has not only been affected by higher interest rates, but also by people spending less time online after the end of pandemic-related restrictions.

Dirk Hahn, chief executive of Hays, said: ‘It is too early to say whether the recent weakness (in permanent hiring) reflects a more sustained market slowdown or short-term deferrals in client and candidate decision-making.

“However, we are delivering on our strategy to focus on long-term growth markets and build a structurally more profitable and resilient business.”

Hays expects to earn around £25 million in exceptional operating profits during the first half of fiscal 2025, which is at the lower end of consensus forecasts.

hay stock They rose 1.7 per cent to 73.65p just after midday on Wednesday, but have been contacted by more than a quarter over the past year.

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