Shares in Robert Walters dropped on Tuesday after the British recruiter warned that full-year profit would be below market expectations given signs of a slowdown in the jobs markets in several key regions.
Robert Walters, a specialist in “white collar” jobs such as legal and accounting, has benefited from a boom in the recruitment market over the past year given the shortages of staff in many sectors and a rebound in corporate growth as the effects of the pandemic receded.
However, chief executive Robert Walters said on Tuesday that the “global macroeconomic backdrop became increasingly uncertain as the [last] quarter progressed, resulting in a softening of recruitment activity levels across many of the group’s markets”.
Evidence of a turn in the previously booming jobs market sent shares in Robert Walters down more than 10 per cent in early London trading, with other recruiters’ shares, such as PageGroup, also dropping.
Employers are becoming more cautious about hiring given signs of an economic slowdown in many parts of the world.
Even so, Robert Walters said that net fee income in the past quarter rose 11 per cent to £105.3mn, with all forms of recruitment — permanent, contract, interim and recruitment process outsourcing — growing “despite the more uncertain market conditions”.
The company said that group net fee income for the full year would be about 20 per cent higher, with full year profit expected to be a record, but slightly below current market expectations.
Asia Pacific net fee income rose 4 per cent, despite dips in income in Japan and Australia, the region’s largest businesses, and net fee income in mainland China down by about a quarter owing to the impact of Covid-19 restrictions.
The company said that “tough market conditions across the US resulted in a significant decline in net fee income”. Europe net fee income rose 21 per cent, although the UK only increased 8 per cent.