Recruiter Hays set to lay out strong jobs prospects as vacancies soar

Global recruitment firm Hays will unveil its full-year results on Thursday with the City expecting to hear more about the boom in employment opportunities in the past few months.

Library image of Chancellor Rishi Sunak
Library image of Chancellor Rishi Sunak

The Covid-19 pandemic hit the jobs market hard but as the recovery picks up pace, companies are looking to hire again and rising inflation is giving employees the chance to pick and choose their ideal roles.

In the UK, job vacancies have been soaring with fewer people looking for work and this is helping recruiters as businesses turn to their expertise to entice the best candidates.

Analysts are predicting Hays to unveil an operating profit of £89.8 million for the year, based on a consensus – down from £135 million a year ago, with net fees expected to hit around £906.4 million, down from £996.2 million in the previous year.

The falls are down to long periods of lockdowns and restrictions during the past 12 months but the City will be hoping to hear more about a positive future following a sharp rebound in the final quarter of the company’s financial year.

Bosses have previously flagged that permanent job hiring is up and companies are more positive on future recruiting.

The future of work also looks set to remain remote for many, with Hays previously revealing it has placed around 400,000 roles, of which 80% were done entirely remotely.

Tech and life sciences have seen the biggest growth – an area Hays is investing in – and cyber and AI-related work is also highly sought after.

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: “Performance at recruitment firms like Hays tends to follow the boom and bust of the wider economy.

“With the group reporting a 39% increase in net fees in the fourth quarter, it seems to be performing exactly as you might expect.

“The particularly strong growth in permanent employment placements bodes well for the strength of the recovery.”

He added: “Traditionally recruitment is a bit of a body shop. Winning new contracts requires hiring and training new recruiters, and consultants are paid in commission, which makes delivering improvements in margin difficult as a result.

“However, during the pandemic the group took steps to cut costs by 13%, it’ll be interesting to see if any of those can be made to stick.”

UK worker numbers rebounded further in July as the labour market recovery continued despite the initial winding down of the furlough scheme, according to official figures.

In response to the figures, Chancellor Rishi Sunak said: “Today’s figures show that our plan for jobs is working – saving people’s jobs and getting people back into work.

“I know there could still be bumps in the road but the data is promising – there are now more employees on payrolls than at any point since March 2020 and the number of people on furlough is the lowest since the scheme launched.”