(Reuters) - International companies are cutting back on hiring and senior staff are reluctant to switch jobs because of uncertainty over Brexit, British recruitment company PageGroup (PAGE.L) said on Wednesday.
Companies in Britain were filling vacant positions and roles created by restructuring, but were holding back on creating new jobs or setting aside budgets for expansion, Chief Executive Steve Ingham said.
“The reality is uncertainty does not breed confidence to move your career from one company to another or commit to hiring people when you’re running a business,” he told Reuters.
Hiring for technical roles in engineering, supply chain, logistics, property and construction were doing better than for areas such as human resources and legal.
PageGroup, which mainly finds candidates to fill permanent positions, reported a 7.6 percent fall in domestic gross profit to 34.9 million pounds for the three months to Sept. 30.
That was a sharper fall than the 4.5 percent slide it reported a quarter earlier and worse than RBC’s forecast of a 2 percent fall.
PageGroup, which generates about a fifth of its gross profit in Britain, said in July that weakness in Britain could last two years.
The British group said it remained on course to meet full-year expectations for operating profit which it pegged at about 113 million pounds. It had reported operating profit of 101 million pounds in 2016.
But analysts said the outlook was disappointing after fellow recruiter Robert Walters (RWA.L) raised its full-year pretax profit forecast for a second time on Tuesday.
PageGroup shares were down 5.5 percent to 496.6 pence by 0835 GMT, making it the second top loser on London's midcap index .FTMC.
Most British staffing companies are relying on their overseas business to drive growth as uncertainty following Britain’s June 2016 vote to leave the European Union curbs domestic demand.
PageGroup reported a 11.8 percent rise in third-quarter group gross profit to 177.3 million pounds, highlighting the United States, China and Germany as standout performers.
Many financial companies have said they will move some British jobs to continental Europe to keep serving clients in the single market. However, PageGroup said it had not yet received requests to make large-scale hires in Europe.
“When I go to Paris and Frankfurt,... I do ask the consultants so are you getting more jobs on the back of London going through Brexit and they shake their heads and say ‘At the moment, no, we’re not”.
Hays (HAYS.L), Britain’s largest recruiter for finance, will publish a quarterly trading update on Thursday.
Reporting by Esha Vaish in Bengaluru; editing by Jason Neely/Keith Weir