City recruitment giant Hays expects ‘subdued summer’ after election uncertainty hits its fees

 A faltering jobs market and added uncertainty from the general election took a toll on City recruitment giant Hays, it revealed today.

The £1.4 billion firm revealed that fees fell by almost a fifth in the quarter to the end of June. Hiring for permanent positions fell the most – by 22% – with temporary posts down 14%. Overall group fees fell by 17%. 

That came as “activity levels in the public and private sector slowed through the quarter, both impacted in June by the UK election”, it said, with “longer-than-normal ‘time-to-hire’” rates and “low levels of client and candidate confidence”. 

Dirk Hahn, its chief executive, added: “Given ongoing global uncertainties, in the near-term we expect our key markets will remain challenging”. 

The company also pointed to the “negative effects” of the French election and “challenging conditions in Germany and Australia,” adding:

“In the UK and Ireland and France we expect a subdued summer, and it is too early to determine when we will see a meaningful recovery. The rest of Europe, the Middle East and Africa remains broadly stable overall.”

In the UK on a sector level,  Accountancy & Finance and Construction & Property decreased by 20% and 15% respectively. Technology decreased by 35%, although Engineering fees were more resilient, up 9%.

Hays made annualised cost savings of around £60 million during the full year. Group consultant headcount decreased by 5% in the quarter and by 18% year-on-year.

Its shares rose 1p to 91p.