- PageGroup reported its gross profits fell by 9.2% to £194.2m in the first quarter
PageGroup has reduced its senior manager headcount as part of a £15million cost-cutting programme amid an ‘increasingly unpredictable economic environment.
Recruiters like PageGroup and London-listed rivals SThree and Hays have seen earnings slump as economic and geopolitical upheaval has weighed on corporate hiring intentions.
Surrey-based PageGroup told shareholders it was taking ‘robust action’ to optimise its cost base by overhauling its leadership and management structure and enhancing the efficiency of some business support functions.
It said the measures would result in an estimated £15million in one-off costs in 2025 but deliver around the same amount in ongoing savings each year.
PageGroup reported gross profits declined by 9.2 per cent at constant currency levels to £194.2million in the first quarter.
The FTSE 250 firm said most of its markets remain affected by ‘low levels of client and candidate confidence’, with the conversion of interviews to accepted offers being a particular problem.
PageGroup said trading was hit by political and economic unpredictability in its two largest territories, France and Germany, with the latter country also affected by the lifting of the ‘debt brake’ to finance defence and infrastructure spending.
Walking away: PageGroup has reduced its senior manager headcount as part of a £15million cost-cutting programme
In the UK, gross profits declined by 12.7 per cent to £23.5million amidst downturns in both temporary and permanent hiring.
However, they expanded by 7 per cent in the United States thanks to solid demand for engineering and manufacturing jobs, and by 14 per cent in India, where PageGroup enjoyed a record quarter.
Nicholas Kirk, the firm’s chief executive, said: ‘Despite the uncertain outlook due to the increasingly unpredictable economic environment, PageGroup has a highly diversified and adaptable business model, a strong balance sheet, and our cost base is under continuous review.’
But he added that the business would not provide earnings guidance due to recent tariffs, which have rocked global markets.
President Donald Trump announced a baseline tariff of 10 per cent on all foreign goods entering the US last week. A planned 25 per cent tax on imported cars also came into effect.
The US Government has since imposed ‘reciprocal’ tariffs on dozens of countries, including a 20 per cent rate on European Union products and a whopping 104 per cent levy on Chinese-made products.
These measures have raised concerns about a slowing employment market as firms that sell a lot of goods to the US face a potentially large drop in sales, which could lead to lower profits and redundancies.
The Institute of Public Policy Research (IPPR) estimates that more than 25,000 jobs in the UK carmaking industry were at risk from tariffs, with Jaguar Land Rover and the Mini factory in Oxford the most vulnerable.
Around one in eight British-made cars exported in 2023 went to the US, making it the second-largest market for such vehicles after the European Union.
PageGroup shares were 2.1 per cent down at 251.4p on Wednesday morning, taking their losses over the past year to approximately 47 per cent.
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