Shares in staffing firm Hays (HAS) hit a 20-year low after the company posted weak second-quarter results.
Since early 2022, Hays shares have lost roughly two thirds of their value as the global job market stays stuck in the doldrums.
| Share price: 49.9p -2% | P/E: n/a |
| Market Cap: £800m | Yield: 2.4% |
PERM TO TEMP
Although the UK market only represents 20% of Hays’ overall business, what it says is instructive.
UK net fee income for the second quarter to December 2025 was down 9% on a like-for-like basis. That follows a 9% fall in the quarter to September 2025 and a 15% fall in the year to June 2025.
The problem for Hays and other recruiters – including PageGroup (PAGE), which reported equally dismal results yesterday – is permanent hiring. With business confidence at rock-bottom due to all the geopolitical uncertainty, permanent hiring is minimal.
At the same time, client confidence is minimal as people don’t want to leave the comfort of their existing job. As a result, companies are hiring more temporary staff without the prospect of them becoming permanent.
In fairness, this isn’t just a UK problem – Hays’ global net fee income was down 10% in Q4 and Perm was down 14%.
Anyone looking to the staffers for signs of an upturn in UK business confidence will have to wait a while. Firms aren’t hiring, and those that are want highly specific skill-sets but don’t want to pay up. They also don’t want to train people in case they leave, and there aren’t any starter jobs for younger people any more.
The recruitment firms’ response is always the same – cut headcount to cut costs, which makes little sense in a relationship business. Suffice to say we have never been fans of the sector – at best it might be a trade when things pick up.
Read the press release here: https://www.haysplc.com/investors
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