RECRUITMENT agencies are often seen as bellwethers for the wider economy – what they see in terms of business enthusiasm or caution on hiring can foreshadow future prospects. It should give us a pause for thought, then, that Hays says there has been no post-election upturn in recruitment in the business world.
Hays warned in April that it was seeing widespread business caution on hiring in the run-up to what was billed as one of the most closely-run and uncertain general elections in a generation.
The company also put its own money where its mouth was in the months leading up to the UK vote last May, adding only 2 per cent more job consultants in the UK and Ireland in the year to June compared to a 12 per cent jump the year before when the UK’s economic recovery was bedding in.
In the event, the Conservatives got an overall majority and were able to dispense with the Liberal Democrats as their previous coalition partners. There was more clarity about the result than had been expected.
However, Hays said yesterday alongside decent annual trading results that it had so far “not seen a post-election acceleration in (recruitment) activity levels”.
So what is making businesses keep their powder dry? The three most obvious factors might be the new jitteriness around China, the next act of the Greek tragi-comedy of whether their country exits the euro, and continuing uncertainty about when the UK and US will move in raising interest rates.
I think the new Chinese syndrome is the most serious of these deterrent factors. Greece, by comparison, is a bit of a sideshow to global macroeconomic growth.
And a lot of professional money now believes Chinese events mean the timing of a move upwards in British and US rates has been put back well into next year.
There can also simply be a lag time between electoral uncertainty being removed and recruitment plans crystallising into action.We will be in a much better position to judge six months or so down the road.
Pernod Ricard shrugs off macro headwinds
Pernod Ricard’s decent annual results against a chequered international trading backcloth show how resilient the sophisticated spirits industry is to changing conditions.
Despite periodic economic and political volatility, the sector has the panoply of brands and global stretch to see crises out.
Meanwhile, as Pernod Ricard shows this time, and its main drinks rivals also do, top echelon spirits’ profit margins remain in that comforting mid-20s zone. Chin-chin.
More jeux sans frontieres
ANNUAL net migration to Britain has soared to a record high of 330,000. David Cameron’s vow to cut the annual total to tens of thousands is discredited.
The business lobby, led by the CBI, say how valuable skilled workers from the EU and elsewhere are to our economy. Migrants trying to storm borders illegally from the poverty-crushed Mediterranean will continue to muddy the waters, and keep the more rabid media in headlines.
The terror attack on the French train shows the danger of borderless countries. All in all, the vexed issue of free movement within the EU is not going to depart centre stage any time soon.