The UK business of recruitment firm Hays has bounced back from its recent declines (see Hays UK back to black), with fourth quarter net fee income (NFI) up 7% thanks to double-digit (12%) growth in the temp market. This echoes rival Robert Walters, which delivered 7% UK growth in the quarter ended 31 March (see here).
Perhaps unsurprisingly, permanent recruitment is subdued, albeit flat, rather than in decline. Hays said that activity was broad-based across 9 of its 12 UK&I regions, including the North West, Scotland and Northern Ireland, the Midlands and Yorkshire, all of which apparently grew by more than 10%.
More surprising however, UK public sector NFI was up 11%, driven ‘primarily by job churn in the permanent segment’, particularly in the education, healthcare and not for profit sectors. So Hays is benefitting from public sector organisations replacing permanent staff with temps - surely not the result the Government is hoping for from the on-going cut backs. Private sector meanwhile was also up, but by a more modest 6% thanks to growth in construction & property, IT and HR. Banking and City-related specialisms remained subdued.
Beyond the UK, continental Europe and rest of world looks more promising (NFI up 9% on a like for like basis). Asia Pacific however fell 13%, driven by an 17% fall in Australia and New Zealand. Although Asia (Japan, Hong Kong, Singapore) NFI grew 20%, the challenges in Australia and New Zealand point to significant challenges ahead here.