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Like smaller rival Michael Page (see UK banking slump hits Michael Page), London-based recruitment giant Hays is also experiencing trouble in the UK banking sector. In Q3 ended 31 March, it said ‘slowing activity’ in banking and ‘City-related specialisms’ drove UK & Ireland private sector net fee income (NFI) down 6%. Outside of banking, the IT, legal and energy sectors apparently continued to deliver ‘good growth’.
Meanwhile, UK public sector net fees were down 2%. This is certainly an improvement compared with the 18% slump public sector faced in H2 (see UK turns red for Hays). But there is some way to go before the public sector can be considered stable. Overall, UK&I NFI was down 5%. And in response, Hays continued with its cost cutting plans reducing UK&I headcount by 5%.
Group-wide, things are far less troubled thanks to Hays’ international business, which contributed 18% NFI growth on a like-for-like (LFL) basis, and now makes up 70% of the group total. This helped group NFI to grow 10% LFL, driven largely by a stellar performance from continental Europe and rest of the world (up 26% LFL) – Germany was singled out delivering a record performance, although we suspect RoW was the main growth contributor. Asia Pacific was also up 9% LFL thanks to 9% NFI growth Australia and New Zealand.
This broad international focus is vital for Hays during these tough times in the UK&I market.
