Robert Walters hit by price range fears as employers maintain off on hiring

Robert Walters has joined rival recruitment firms Hays and PageGroup in reporting weaker quarterly performances across all major territories.

The white collar recruiter, whose namesake founder retired last year, saw net fee income decline 12 per cent on a constant currency basis to £79.9million in the three months ending September.

Net fee income slumped by 19 per cent to £12.5million in the UK, which the company blamed on firms ‘generally pausing activity pending clarity’ on future employment laws and fiscal measures in the government’s upcoming October budget.

Warning: Robert Walters’ chief executive, Toby Fowlston (pictured top right), said the business still expects trading conditions will not get better until 2025

Meanwhile, its income fell by 12 per cent to £35million in the Asia-Pacific market, partly due to challenging trading conditions in Hong Kong and public sector job cuts in New Zealand.

Recruitment firms have struggled with slowing trade this year as higher interest rates and economic uncertainty have dissuaded companies from hiring new staff.

PageGroup reported on Monday that its gross profits declined by 13.5 per cent to £201.4million in the quarter ending September, while Hays said last week that its net fees dropped by 15 per cent over the same period.

Both PageGroup and Robert Walters have cautioned that client and candidate confidence rates has ‘yet to show signs of material improvement’.

The latter’s chief executive, Toby Fowlston, said the business still expects trading conditions will not get better until 2025 and fee income over the second six months of this year ‘is unlikely to exceed’ first-half levels.

However, he assured investors that a ‘programme of actions underway’ means the group still expects to be profitable over the full year.

Fowlston added: ‘As we approach the end of 2024, I am confident that we will close the year a stronger business than when we entered.’

Last week, the UK Government unveiled the Employment Rights Bill, containing 28 individual reforms designed to enhance protections for workers.

Among the proposed measures include the abolition of zero-hours contracts, day-one rights for parental and bereavement leave, and making flexible working the ‘default’ for all workers.

Many business groups are concerned that the plans will make it more expensive for firms to hire new staff and could worsen the unemployment rate.

A British Chambers of Commerce survey released earlier this month revealed that the share of firms seeking new staff shrunk to 56 per cent, its lowest level in three years.

Robert Walters shares were flat at 351p on late Tuesday morning, meaning they have slumped by around a quarter this year.