Page braces for sharp fall in earnings as jobs market continues to slow
17 April 2023, 08:24
The recruitment firm said it expects operating profit to drop by 29% to around £140 million in 2023.
Recruiter Page Group has cautioned over a steep drop in annual profits as it said the global pull-back in hiring seen at the end of last year has continued into 2023.
The firm said trading remained tough across many of its key markets, with steep falls in gross profits across the UK, north America and Asia.
It reported a 9.4% drop in UK gross profits for the first three months of 2023, which comes after a 1.9% decline in the final three months of last year.
Gross profits tumbled by 21% in Asia and 14% in north America in the quarter.
The firm said it expects operating profit for 2023 to be in line with a company-compiled consensus of £140 million – a 29% fall on the record £196.1 million notched up in 2022.
Chief executive Nicholas Kirk said: “The challenging conditions we saw towards the end of 2022 continued into 2023, with lower levels of both candidate and client confidence resulting in delays in decision-making and candidates being more reluctant to accept offers.
“Reflecting the uncertainty, temporary recruitment outperformed permanent as clients sought more flexible options.”
Rival Robert Walters also recently said it was seeing more difficult trading this year as global economic uncertainty impacts company hiring.
It reported a 9% decline in income in the UK to £16.3 million.
Firms are cutting jobs or freezing recruitment in the face of soaring costs and worries over the economic outlook.
Page said it has trimmed its fee earning team by 4.4% in the quarter amid the more difficult job market conditions, with 304 fewer roles and reductions across all regions.
The UK market saw clients defer hiring conditions, in line with the trend in many other global markets, the company added.
Reflecting the trend towards more temporary recruitment and a drop in permanent hiring, it saw fee income tumble 14% at Michael Page and lift 4% in its temporary recruitment specialist Page Personnel.
Page cut its UK fee earning workforce by 66 in the first quarter.
Overall, Page saw group-wide gross profits drop 2.4% on a constant currency basis in the first quarter.
Including a boost from foreign exchange rates, gross profits lifted by 1.8%.
