January 15, 2019 / 7:19 AM / 7 months ago

Staffing firm Hays bets on Germany despite economic slowdown

(Reuters) - Britain’s staffing company Hays Plc (HAYS.L) said it had not seen any weakness in Germany’s job market despite Europe’s largest economy growing at the weakest rate in five years.

Germany, the company’s largest market, is struggling with a cooling global economy, trade disputes triggered by U.S. President Donald Trump’s ‘America First’ policies and the risk of Britain leaving the European Union without a deal in March.

Hays, which is largely focused on white collar roles rather than the factory, farming and catering sectors, reported an 8 percent rise in net fees for the second quarter ended Dec. 31, boosted by strong hiring in Germany, where fees grew 15 percent.

Finance Director Paul Venables told Reuters that Hays’ large engineering business, within its technology hiring arm, had performed strongest in Germany.

“We are mindful of the economic data ... Are seeing strong growth currently, no obvious signs of weakening ... clients are both focused getting out the specialists we can provide them and a bit more cost control,” he said.

Hays’ performance in Germany echoes that of rival PageGroup Plc (PAGE.L), which reported strong growth there on Monday.

London-based Hays said net fees from its Britain and Ireland operations, which account for 23 percent of total fees, rose 3 percent in the quarter despite “continued economic uncertainties”.

“Our clients continue to replace any leavers and from a candidate standpoint we have quite a confident market in the UK ... Candidates continue to change jobs,” Venables said.

But he said growth in Britain was clearly lower than before the vote to leave the European Union. Information technology posted the strongest performance in the country.

“Whilst clearly the political environment is uncertain, we are seeing a fairly good constant growth even in City of London,” he said.

Venables said Hays had seen “some weakness” in the job market in Paris, which has faced disruption from the “yellow vest” protests.

“I don’t think the (yellow vest) riots would have helped sentiments in the Paris market but also having had several strong years of growth with our clients, we’ve seen a bit more cost control focus,” he said.

He said a trade war between Beijing and Washington hit several markets including France, where the firm had seen caution.

“I think we’ll do much better in the next six to nine months but at the moment it is a very strong recruitment market globally,” he said.

Reporting by Sangameswaran S and Noor Zainab Hussain in Bengaluru; Editing by Shounak Dasgupta and Edmund Blair

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