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Recruiter Hays boosted by record net fees, but cautious on outlook
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(Reuters) -Global recruitment company Hays said employers had reduced the number of new temporary hires but extended existing contracts, helping it to post record net fees in the three months to March, despite a tough permanent
(Reuters) -Global recruitment company Hays said employers had reduced the number of new temporary hires but extended existing contracts, helping it to post record net fees in the three months to March, despite a tough permanent job market.
Inflation and concern of recession have led many companies to cut jobs or freeze hiring, while shifting towards more flexible labour that for now has boosted fees for some recruitment companies.
In a trading statement on Friday, the London-based company, focused on white-collar roles, especially in the technology sector, predicted its operating profit and percentage of successful hires in the second half of the fiscal year ending June 30 would be “modestly above” the first half.
“Client and candidate activity remains solid overall in Temp and Contracting, with modestly lower numbers of new assignments broadly offset by greater contract extensions,” Hays said.
In the third quarter ended March 31, like-for-like net fees rose 5% to record levels.
In its largest market, Germany, net fees grew by 23%, although extended pandemic lockdowns in China led to a 26% decline.
Fees from the temporary hiring segment, its largest business, grew by 11%, while the permanent division fell 2% as placement volumes declined.
(Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Subhranshu Sahu and Barbara Lewis)
Temporary hiring refers to the practice of employing workers for a limited period, often to meet short-term needs or project demands.
Net fees are the total earnings a company receives from its services after deducting any costs or expenses associated with those services.
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power.
A recession is a significant decline in economic activity across the economy lasting more than a few months, typically visible in GDP, income, employment, and production.
Contract extensions refer to the process of prolonging the duration of an existing employment or service agreement beyond its original end date.
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