Recruitment fees rocket as firms search for workers

GLOBAL recruitment giant Hays says that Britain’s permanent jobs market is the hottest it has been since the credit crunch and global financial crisis.

Group finance director Paul Venables said that due to the intense competition for skilled workers, the white-collar recruiter had seen candidates in some sectors offered pay increases of up to 20 per cent to switch jobs.

He said: “Employers have been caught out by the speed and the acceleration in the economic recovery, and it has been much stronger than expected.

“There’s a shortage of people, so they are having to pay out more than they would have done pre-pandemic.”

September was Hays’ best month since the pandemic started, helping its first quarter fees grow 36 per cent compared with the same three-month period last year.

It said that a 58 per cent surge in permanent fees drove its growth, while income from placing temporary roles rose 22 per cent.

Hays saw a 44 per cent increase in fees from its British arm during the quarter, driven by “excellent growth” of 69 per cent in permanent fees. Temp income was up 29 per cent. Fees from private sector employers rose 57 per cent, while the public sector grew by 21 per cent.

While most regions saw fee growth in line with the overall UK business, Hays said the North-west and the Midlands experienced the strongest growth, up 74 per cent and 51 per cent respectively. London grew by 46 per cent.

The UK and Ireland was Hays’ best performing region, with net fees up 44 per cent. The United States, South America, Asia and Europe saw growth of 37 per cent. Germany was up 31 per cent, while income from Australia and New Zealand was up 29 per cent.

Neil Shah, director of research at analysts Edison Group, said: “Set against the context of UK job vacancies reaching a 20-year high, the group looks to be in prime position to thrive.

“However, the outlook for the sector retains an element of uncertainty due to a potentially disruptive combination of labour shortages, inflation and the end of the furlough scheme.”