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PageGroup has flagged a recovery in the US jobs market, with a boost in confidence among American employers helping to offset sinking profits in the recruiter’s European business.
London-listed PageGroup reported a 10.5 per cent fall in gross profits in its second quarter on Thursday in constant currencies to £194.8mn, largely due to worsening hiring conditions in its biggest markets of France and Germany.
However, chief executive Nicholas Kirk said that “sensible business” was now taking place in the US, with profits from placing candidates in the country rising for a third straight quarter. PageGroup reported a 2.9 per cent rise in profits from its Americas division, which accounts for just under a fifth of the total group, with North America up 13 per cent.
The Surrey-based recruiter has been battling difficult conditions across the global jobs market, with economic uncertainty and geopolitical turbulence putting employers off making hiring decisions.
But Kirk said that clients and candidates in the US had become more open to negotiations. His comments follow better than expected labour market data published last week, with 147,000 jobs added in June, up from 114,000 the previous month, despite concerns that President Donald Trump’s tariff and immigration policies would soften demand.
“The recovery in the US is more confidence led,” said Kirk, adding that “clients have understood they may need to go a little bit higher and candidates need to come a little bit lower.” He added that demand was highest for engineering and construction jobs.
In April, PageGroup declined to offer full-year guidance because of tariff-related uncertainty. On Thursday, the recruiter said it was expecting operating profits of about £22mn in the year to the end of December, down from £52.4mn last year but in line with market consensus. Shares were broadly flat in morning trading.
The group said tariffs were still weighing down on market conditions in Europe, with profits in Germany sinking 21 per cent as companies put off making decisions for that reason. In France, profits were down 20 per cent.
Meanwhile Kirk said that in the UK, companies were struggling with tight budgets following rising labour costs unveiled in last year’s Budget, including increases in employers’ national insurance contributions.
Simon Lechipre, a Jefferies analyst, said he viewed the results as “better than feared”, adding that PageGroup shares “probably already priced in” the tougher trends in Europe following a recent profit warning from rival Hays.
