'High caution' over hiring by UK companies due to National Insurance rises, warns recruitment giant Robert Walters

The company said there had been an “extended period of tough market conditions”. It added: “Client and candidate confidence levels were subdued throughout the year, impacting both specialist recruitment and volume hiring.”

In the UK, net fee income was down 17 per cent to £50.4m, including a 21 per cent drop in revenues relating to specialist professional recruitment.

The results stated: “London (-13 per cent) outperformed the regions (-31 per cent), with the legal and accounting disciplines in London showing the greatest resilience.

"Conditions in the regions toughened in the latter part of the year. Levels of employer caution on hiring remain high, partly in anticipation of forthcoming higher National Insurance contributions.”

It added: “Net fee income was down 14 per cent. This primarily reflected lower levels of perm volume hiring from financial services clients, however fees were sequentially stable half-on-half.

“The workforce consultancy offering delivered 24 per cent growth in net fee income year-on-year, driven by a higher average number of consultants deployed with clients. With the clear benefits to clients in lowering cost and compliance, awareness of the solution is growing in potential client pools beyond the managed service provider segment in which the business launched in 2022.”

Toby Fowlston, Chief Executive, said: "2024 was another challenging year for global hiring markets. Several factors acted to dampen client and candidate confidence levels, therefore slowing the pace of job moves and impacting our financial performance. Notwithstanding this, the business made good early progress against our refreshed strategic plan of disciplined entrepreneurialism.

“We increased focus on fee earner productivity and continued to develop the technology to enhance it. We are more consistent in our front-office ways of working, and are realising benefits from optimising our support functions. Meanwhile, we took the decision to further consolidate our office network and drove meaningful cost savings from co-ordinated procurement.

"Looking further ahead, we continue to be excited by the opportunity to support clients and candidates in the rapidly changing world of work, and this grounds our confidence in our service line diversification focus areas of interim management, workforce consultancy and talent advisory.

“Though it remains uncertain as to when a sustained improvement in hiring markets will commence, we have high conviction in the value we add to clients and candidates as a talent solutions provider. The early progress in executing our strategic plan gives us confidence as we drive further momentum in 2025."