The coming week features updates from three sizeable recruiters, Robert Walters, Pagegroup and Hays, which have all noted a marked slowdown in activity this year.
With unemployment remaining in the UK, USA and Western Europe remaining relatively very low this year in the face of repeated interest rate rises over the past 18 months, emerging cracks are being closely looked out for (as well as their absence, see the hubbub around the stronger than expected US jobs report for September).
The smallest of the trio, Robert Walters PLC (LSE:RWA), reports on Tuesday 10 October, followed by middle child PageGroup PLC (LSE:PAGE) on Wednesday, with fellow FTSE 250-listed peer Hays PLC (LSE:HAS) on Thursday.
Back in June, Robert Walters issued a profit warning in June and then in July confirmed the jobs market is under pressure globally, with the UK and US catching the brunt of the downturn due to inflation and a tech shake-out.
Since then, all three have released results with no further alerts about the outlook.
However, pointed out analysts at AJ Bell, all three noted:
- a swing in hiring activity toward temporary rather than permanent staff – usually a sign of low corporate confidence – although Hays has the greatest exposure to temporary hires (which also represent around a third of fees at Robert Walters)
- Signs of weakness in the UK, USA and China
- Decreases in their own headcount
- Skill shortages, strength in technology and engineering and outperformance from Europe were more encouraging common themes
- All three firms felt confident enough to run share buybacks, or issue a special dividend, thanks to their net cash balance sheets.
Hays