April 8, 2020 / 7:22 AM / 4 months ago

Recruiter PageGroup cuts more jobs, directors' pay as fees fall

(Reuters) - Recruitment firm PageGroup (PAGE.L) said on Wednesday it would shed another 250 staff in April and cut directors’ pay by 20%, as the company and its peer Robert Walters (RWA.L) reported double-digit falls in gross fees in the first quarter and braced for more pain to come.

London’s group of stock-exchange listed global recruiters have been battening down the hatches for weeks in expectation of a collapse in revenue due to the coronavirus crisis, and analysts and industry players have said steeper staffing cuts looked unavoidable. The company, which operates in 36 countries and helps hire executives, professionals and clerical staff, joined peers including (HAYS.L) and SThree (STEMS.L) in cancelling dividend payouts and suspending financial forecasts due to the coronavirus crisis.

PageGroup said it had already laid off 104 fee earners and 28 operational support staff in the first quarter, and saw net fees plunge by one-fourth in March, normally its busiest month.

Analysts at Jefferies in a note said that the company saying its headcount was unlikely to reduce significantly in the short term through natural attrition, as was the case during the Global Financial Crisis, suggests it may be loss-making in the second and possibly third quarters.

Separately, smaller operator Robert Walters reported an 11% cut to gross fees dragged down by its UK operations, where employers’ demand for staff plummeted in March with job vacancies contracting for the first time in nearly 11 years, a survey of recruiters showed on Wednesday.

Robert Walters also slashed its board pay while saying it had reduced its workforce by 2% - or 92 jobs - in the first quarter compared to the end of 2019.

“The voluntary reduction in hours taken up by staff across the globe, plus the various furlough schemes put in place by a number of governments, will flow through into the second quarter headcount figures,” Robert Walters, chief executive of the eponymous company, said in a telephone interview.

“In addition we will not be hiring new staff in this environment and there will also be natural attrition as per normal course of business.”

Reporting by Yadarisa Shabong and Indranil Sarkar in Bengaluru; Editing by Vinay Dwivedi and Alexandra Hudson

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