Robert Walters blames Budget uncertainty for slump in UK fees

Recruiter Robert Walters has reported a slump in fees over the summer as economic and political uncertainty dragged on hiring in the UK and Europe.

The London-listed firm reported UK net fee income of £12.5m for the three months to the end of September, down 19 per cent from the same period last year on a constant-currency basis.

It pinned the fall on “clients generally pausing activity pending clarity on employment legislation and fiscal measures”, which are set to be outlined in Labour’s inaugural Budget on 30 October.

Employers are bracing for potential shake-ups from Chancellor Rachel Reeves, who is widely expected to hike taxes to address an alleged £22bn “black hole” in the public finances.

Robert Walters’ overall net fee income globally dropped 14 per cent to £79.9m. All of the regions it operates in saw declines, including 14 per cent falls in both Europe and Asia Pacific.

The firm, which has offices in 31 countries, swung to a half-year loss of £2.3m in August as it continued to be victim to the global jobs market slowdown.

Its share price is down 24 per cent so far this year and fell 2.3 per cent in early trading on Tuesday.

Still, Robert Walters reiterated its expectation of being profitable in the full year despite larger rivals Hays and PageGroup both warning of near-term weakness in the hiring market.

“Global hiring markets remained challenging during the third quarter, bringing the period of rebasing following the 2022 post-pandemic peak to around two years,” said chief executive Toby Fowlston.

“Though market conditions mean second-half fee income is unlikely to exceed that seen during the first half, the programme of actions underway mean we continue to aim for a profitable full-year outcome.”

Robert Walters specialises in hiring for the legal, accountancy and technology sectors. It has shed almost 600 staff over the last year, with headcount falling 17 per cent year on year in the third quarter to 3,466.

The firm added that it continued to be “selective” in replacing fee-earning staff that leave the company and was “focused on ensuring strong average fee earner tenure ready for when market conditions improve”.