Global recruiter Robert Walters has issued a warning that the ongoing global hiring slowdown is expected to persist, with market recovery unlikely before 2025.
The company reported a significant 15 percent decline in gross profit for the second quarter, amounting to £84.8 million, resulting in an 18 percent drop overall for the first half of the year.
The UK division experienced notable setbacks, with an 18 percent decrease in the second quarter and a 19 percent decline over the half-year.
Robert Walters’ Chief Executive, Toby Fowlston, attributed the prolonged market correction to the aftermath of the volatile pandemic years, stating, “This period of market adjustment is now longer in duration than previously expected, with macroeconomic turbulence and political uncertainty restraining client and candidate confidence in certain geographies.”
A gradual improvement
Fowlston further noted that the company’s near-term planning assumes a gradual improvement in confidence levels, with significant progress not expected before 2025. He added that the current market conditions suggest a broader range of potential outcomes for the full year compared to historical trends.
In response to the challenging market environment, Robert Walters has adjusted its workforce, cutting its staff by 5 percent since the first quarter and by 15 percent year-on-year, bringing the total to 3,625 employees. The company is being highly selective in replacing fee earner natural attrition to align with current demand conditions.
This update comes as Robert Walters joins other recruitment firms, such as PageGroup and Hays, in reporting decreased gross profits for the second quarter. Hays recently highlighted additional challenges due to political uncertainty from upcoming elections in the UK and France, further affecting trading conditions.
What about net fee income?
Robert Walters’ second-quarter results showed a 15 percent decline in gross fees across the Asia Pacific region, a 14 percent percent drop in Europe, an 18 percent fall in the UK, and a 14 percent decrease in the rest of the world. The UK saw more challenging conditions in the regions, with a 21 percent plunge in net fee income compared to a 6 percent drop in London. Recruitment outsourcing, which accounts for over half of UK fee income, slumped by 19 percent.
Shares of Robert Walters fell by 3 percent in morning trading on Monday following the announcement of these results.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
