Page sees its UK growth halt despite global surge

RECRUITMENT group Michael Page International saw UK profit growth nearly grind to a halt as public and banking sector work dried up in the third quarter of the year.

The group also said it had little visibility on the rest of the year after economic turmoil put the brakes on demand across all regions during the year.

Chief executive Steve Ingham said the gloomy news surrounding the economy both in the UK and further afield was affecting sentiment.

“Bad news tends to lead to indecision from candidates and clients and that has had some impact on our business. It’s that indecision that has crept into our market that has caused the growth rates to come off the peak they were.”

The group, which employs more than 1,400 people in the UK, said gross profits in the UK rose by just 0.3 per cent to £33.1 million in its third quarter, against growth of 48 per cent in the Americas and 44 per cent per cent in Asia-Pacific.

Overall it reported a 22 per cent rise in gross profit to £142.7m, broadly in line with analysts’ forecasts for the third quarter although below the 29 per cent and 30 per cent seen in the first and second quarters.

Michael Page, like its competitor Hays, is being helped by continued strong growth in emerging markets, although Ingham said clients across all regions were more cautious about taking on staff while there was so much uncertainty about the fate of the global economy.

“I don’t think it’s catastrophic but people are just being cautious about making the actual offer and that reflects all the very negative news out there.”

Although shares in the company have lost about a third of their value since July, Investec analyst Robert Morton said the long-term investment case was still strong. “The short-term outlook will clearly be affected by the recent global financial turmoil which is likely to slow corporate hiring but we believe the longer-term recovery and structural growth investment case remains intact.”

Shares closed down 5.7p at 358p.