Hays' profits drop by half as hiring slowdown persists

Hays, a FTSE 250 recruiting firm, has been working on cost-cutting measures to drive profit, but this has yet to be reflected in its profitability. Hays’ profits drop by half as hiring slowdown persists.

For several months, Hays has warned that the hiring market has been slowing down, impacting its placement volumes and fees. Last week, the company reported £26 million in adjusted profit, a 56% slump compared to the same period in 2023. The firm attributed the decline to “tough conditions in key markets, particularly towards the end of the half in Perm”.

The entire group saw a 13% decline in fees to £496 million over the six months leading up to the end of 2024 compared to the previous year. Temporary recruitment and contracting work fell by 9%, while permanent recruitment declined by 19%. The company explained, “Temp & contracting was more resilient than perm and included strong performances in several of our Focus countries”. As one of the largest recruitment firms in Europe, specializing in white-collar jobs, Hays’ financial performance is closely tied to overall market conditions.

In 2023, the firm closed 15 offices in the UK and Ireland and reduced its number of consultants by more than 1,100, including 300 roles in the UK and Ireland. These redundancies brought the total headcount to approximately 6,800 by the end of 2024, a reduction of about 2,700 over two years.

Hays explains, “Economic and political uncertainty weighed on client and candidate confidence driving lower placement volumes and a material lengthening of our ‘time-to-hire’.”

Despite the decline in profit, the firm insists it has strong cash flow, with a 257% cash conversion rate and net cash of £29.0 million. It has improved resource allocation and reported a sector-leading 4% year-over-year increase in consultant fee productivity in H1 2025. Additionally, net fees from enterprise clients grew by 12% in Q2.

Dirk Hahn, Chief Executive Officer, commented “Our focussed strategy has five levers designed to build a structurally more profitable, resilient and growing business and, despite ongoing macroeconomic uncertainty, we have remained relentlessly focussed on delivering them. Our 4% consultant fee productivity increase is sector leading, our structural cost savings initiatives are progressing well, net fee growth in Enterprise accelerated to 12% in Q2, and Temp & Contracting net fees are growing strongly in several of our Focus countries. However, we continue to face considerable headwinds from economic conditions and our like-for-like operating profit declined by 56% YoY. The Board and I are very grateful for the deep commitment shown by all our colleagues through this challenging period. We remain focussed on long-term growth markets underpinned by our culture and talented colleagues worldwide. Our key markets are being driven by powerful, supportive megatrends and remain characterised by significant talent shortages, which we help solve for our clients. When client and candidate confidence improves and the cycle recovers, I am confident we will deliver a healthy drop through of net fees to operating profit.”

For more details, see Hays’s announcement here.