Hays sees decline in UK hiring amid tough post-Brexit conditions

Recruitment company Hays has reported a "sharp decline" in the numbers of staff hired by businesses and banks, amid what it describes as "tough conditions" following the Brexit announcement. Although the market is stable, Hays' City figures had dropped 3%, while overall fees from banking were down 12%, and cutbacks were also seen across construction and property companies. Hays Alistair Cox, the chief executive said it was "too early" to say how much the post-Brexit uncertainty would last. In contrast, business in Europe and the US is booming.

The recruitment firm Hays has reported a sharp decline in hiring by banks and other companies after the Brexit vote in June and warned that conditions remain tough.

The company, which places people in permanent jobs with finance, construction, property and IT companies as well as finding jobs for office temps and other temporary workers, said it was too early to assess the longer-term impact of the British vote to leave the EU.

Alistair Cox, the chief executive, said: “In the UK, following a step down in permanent activity immediately after the EU referendum, conditions are tough but broadly sequentially stable and it is too early to have a clear view on the extent to which the post-Brexit uncertainty will impact our business in the current financial year.” He said Hays had seen no evidence of any impact elsewhere in Europe.

Shares in the company dropped 5.4% to 123.5p on Thursday morning, taking it to the bottom of the FTSE 250 index.

Net fees in the UK and Ireland were flat at £272m in the year to 30 June, as companies took on fewer staff in the run-up to the 23 June referendum and in the immediate aftermath. Hays’ City business was down 3%, with a tough banking market. Overall fees from banking dropped 12% as banks scaled back hiring. Construction and property companies also cut back.

Major investment banks such as Goldman Sachs and JP Morgan have warned that they could move thousands of staff from the UK to the continent following Britain’s decision to leave the EU.

Hays said fees at its public sector business were down 4% over the year, particularly in local government and healthcare, as the UK’s austerity drive took its toll.



In response, the company reduced its headcount in the UK by 8%, or 179 consultants, by natural attrition (ie not replacing people who left or retired), but has no plans for further headcount reductions this year.

It took on 319 consultants in continental Europe and North America, where business is booming. Hays reported strong fee growth of 13% in Germany, while France was 17% ahead and the US up 15%.

Across the group, net fees were up 6% over the year to £810m. Profits before tax climbed 11% to £173m.

Hays has 252 offices in 33 countries. The international business makes up two-thirds of its net fees, more than double the level a decade ago.