Hays PLC (LSE:HAS) shares fell 2% after reporting a drop in recruitment activity in the UK, echoing comments from industry peers, Robert Walters PLC (LSE:RWA) and PageGroup PLC (LSE:PAGE) in recent days.
In a sign that the UK jobs market could be slowing down, the FTSE 250-listed recruiter said regional fees fell 7% in the UK & Ireland – which makes up 20% of its business – while overall net fees dropped 2% in the fourth financial quarter ending on June 30.
In the UK & Ireland, temporary worker fees stayed flat while permanent placements dropped 15% as tougher conditions slowed hiring activity.
Victoria Scholar at interactive investor said the figures from Hays reflected “macroeconomic headwinds which are deterring companies from taking on the fixed costs of permanent hires”.
Nonetheless, Hays said it still expects to post a full-year operating profit in line with market expectations of £196.2mln.
On Wednesday, its competitor PageGroup said its UK gross profit was down 17% in the most recent financial quarter and 12% for the first half of the year.
Last week, Robert Walters reported a 21% fall in UK revenue to £16mln during the recent quarter through to the end of June, which the company said was a result of the high inflation, high-interest rate environment in addition to tech and financial sector lay-offs.
Earlier this week, the latest figures from the Office for National Statistics showed a rise in the rate of unemployment to 4.0% and a drop in vacancy numbers, another indicator that the jobs market may be showing signs of loosening.
“With job vacancies in the UK declining for twelve consecutive months, the appetite for hiring is diminishing, weighing on the recruitment sector,” Scholar said.