Hays achieves record quarterly revenues thanks to a robust staffing market and excellent performance in Germany
- Net fees at Hays were up 5% on a like-for-like basis for the quarter ended March
- Longer contract extensions helped increase mid-placement fees by 11%
- The FTSE 250 group achieved record amounts in Germany, France and Switzerland
Hays delivered its best-ever quarterly result after record payroll revenues in eight countries and a growing employer shift to temporary hiring.
Net compensation at the recruiter was up 5 percent on a like-for-like basis for the three months ended March despite heightened global economic pressures and 10 percent overall due to a depreciation of the pound sterling.
Longer contract extensions drove compensation for temporary placements up 11 percent, offsetting a decline in the permanent hiring segment as uncertainty caused companies to take longer to hire full-time workers.
Talent war: Over the past two years, many companies have offered large pay raises to attract or retain talent, which is a huge windfall for UK headhunters
In Hays’ largest market, Germany, net compensation rose 23 percent to record levels amid a skills shortage and high demand for talent from the technology, engineering, accountancy and finance sectors.
The FTSE 250 company also achieved the highest quarterly rates ever in Switzerland and France, where they rose 15 and 16 percent respectively, while in the United Arab Emirates they rose by more than half.
Performance was weaker in the British Isles and Australia, due to declining turnover from permanent hires and major regions such as London and New South Wales.
Meanwhile, trade in China has continued to be impacted by the Covid-19 pandemic, even as the country’s government has significantly eased lockdown restrictions.
Still, the London-based company expects better operating results and a higher rate of successful hires in the second half of the fiscal year.
Alistair Cox, the outgoing CEO of Hays, said: “Our key markets continue to be characterized by acute skills shortages and wage inflation, and we are taking advantage of our early management actions to increase compensation margins in skills shortage markets.”
Employers around the world have struggled to recruit new staff over the past two years amid a “massive layoff” of workers seeking better pay and benefits.
Many firms have offered large pay raises to attract or retain talent, which is a huge windfall for UK headhunters, whose fees are usually based on a percentage of a new hire’s annual salary.
The global job market has remained relatively vibrant, even as rising energy prices and interest rate hikes by central banks have slowed economic growth and hiring.
Technology companies, a major part of Hays’ revenues, have been at the forefront of staff cuts and hiring freezes in recent months as the easing of pandemic-related restrictions means people spend less time online.
About 170,000 technical workers have already been laid off or will be laid off in 2023, 6,000 more than in the entire previous year, according to the data tracker website Layoffs.fyi.
Many of the most prominent Silicon Valley giants, including Amazon and Facebook owner Meta, have announced major layoffs.
Hays shares were 0.5 percent higher at 114.6 pence by mid-Friday afternoon, though their value has shrunk by about 31 percent over the past two years.