Hays latest to see signs of hiring slowdown as economic woes mount

Hays has become the latest recruitment firm to flag signs of a hiring slowdown as it said mounting economic gloom was impacting activity in the UK and United States.

The group said it has seen hiring activity drop “modestly” in some of its markets worldwide “as macroeconomic uncertainties increase”.

Hays said this was being seen across the UK and Ireland, which accounts for more than a fifth of net fees, as well as the US and Australia and New Zealand.

It comes after rival PageGroup said on Wednesday that it was seeing a “slight softening” in confidence among firms recruiting across most of its markets worldwide.

The global hiring market has been firing on all cylinders as countries have emerged from the pandemic, with a war for talent driving salaries sharply higher and leading to labour shortages.

But soaring inflation and fears of a global recession as economies emerge from the pandemic are beginning to see companies rein in their hiring plans, with a raft of companies freezing recruitment.

Hays chief executive Alistair Cox said: “Our forward-looking client and candidate activity levels remain good overall, particularly in Germany and Europe, Middle East and Africa, but have reduced modestly in a number of other markets as macroeconomic uncertainties increase.

“This said, our key markets continue to be characterised by acute skill shortages and wage inflation.”

But Hays added that many key regions continue to be impacted by “acute” skills shortages and wage inflation, while Europe, including its largest market Germany, were among those continuing to see good overall activity.

It cheered a record performance in its first quarter, with fees up by a better-than-expected 15% on a like-for-like basis.

The firm also said the weakness of the pound has helped boost earnings so far this financial year.

The group added that current exchange rates would have boosted last year’s £210.1 million in operating profit by around £9 million.

Its update showed that UK like-for-like fees rose 11% in its first quarter.

Germany saw fees rise 26%, while the rest of the world saw a 16% hike and Australia and New Zealand lifted 3%.