Hiring firm bemoans Brexit

By John Revill

Britain’s messy divorce from the EU is weighing on hiring sentiment in the country due to uncertainty about whether it will leave with a deal, according to Adecco, a temporary staffing firm.

Brexit is adding to problems caused by the escalating US-China trade war and Europe’s flatlining manufacturing sector, where the car industry is struggling, said chief executive Alain Dehaze.

“It [Brexit] is really affecting the mood — it is reflected in temporary staffing and permanent recruitment which are down,” said Mr Dehaze.

People have been expecting clarity for a long time, hopefully it will come.

Some were expecting a no-deal departure, while others thought a deal with the EU could be arranged, he said.

“The mood is shifting and becoming more downbeat. We need clarity so companies can start to act and implement their strategies,” said Mr Dehaze.

Swiss-based Adecco said last year that financial companies in London were holding off hiring financial staff in London due to Brexit.

British-based staffing companies have also recently highlighted jitters among employers about taking on both senior and shop floor workers. Pagegroup, which places candidates in permanent rather than temporary jobs, said in its half-year results that Brexit uncertainty continued to affect decisions by clients and candidates at senior levels.

Meanwhile, blue-collar temporary staffing company Staffline cut its profit outlook in May, saying companies were scrambling to transfer temporary workers to permanent employment status ahead of Brexit.

Adecco reported a 3% fall in revenue for its second quarter, a worsening trend from the start of the year when its revenue shrank 2%. The slide continued at the same rate into July as the downturn in automotive and manufacturing sectors which has hit companies such as Siemens and BMW also weighed on Adecco’s European business.

“The major concern is coming from Europe, that is where you see the real deceleration,” said Mr Dehaze.

There is a lot of uncertainty, there is Brexit (and) the trade war which has impacted automotive in Germany which is also being affected by electrification.

Staffing companies like Adecco are seen as proxies for the health of the broader economy, with companies taking on temporary staff at the beginning of a recovery and letting them go during a downturn.

- Reuters