Eleven global recruitment agencies; Hays, Manpower, Page Group (Michael Page), Robert Walters, Randstad, Robert Half, SThree, Kelly, PERSOL, Outsourcing and Adecco have recently released quarterly updates for trading results to 30 June.
In terms of large global companies with a significant local presence, half-yearly or quarterly results have yet to be announced by Recruit Holdings (Chandler Macleod, peoplebank) and Will Group (U&U, Quay Appointments, DFP Recruitment, Ethos Beachchapman).
The results tell a strikingly similar tale:
Selected global recruiters: Q2 2020 results
|Company||Decline in global result||Decline in regional result||Region with largest decline|
|Michael Page||47.6%||Asia Pacific 41.6%||UK (61.5%)|
|Robert Walters||34%||Asia Pacific 34%||Other International (36%)|
|Hays||34%||ANZ 28%||UK & Ireland (42%)|
|Robert Half||33.6%||NA||Accounting & Finance (49.6%) *|
|Manpower||31.9%||Asia Pacific Middle East 19%||France (47.5%)|
|Randstad||30.7%||Rest of World 2% (revenue)||France (41%)|
|Adecco||30%||ANZ 12%||France (44%)|
|Kelly||21.7%||APAC (up 10.8%)||Ireland (61.9%)|
|SThree||7%||Asia Pacific 28% (H1)||Asia Pacific (H1 28%)|
|Outsourcing||5.3%||NA||Other Business (H1 92.3%)|
|PERSOL||3.6%||APAC 1.6%||Solution (29.5%)|
Note: All results are gross profit changes for the April – June quarter of 2020, compared to the same quarter in 2019, except SThree (Dec 2019 – May 2020, H1) and Outsourcing (Jan – June 2020, H1), all results are in constant currency unless otherwise noted. Robert Half only released data by division, rather than by region. * indicates revenue decline as gross profit results per division were not released. Robert Half Accounting & Finance is permanent placements only. Persol’s APAC results are consolidated with a delay of 3 months. Q2 for PERSOL APAC covers the period from January to March 2020. PERSOL operates a 1 April – 31 March financial year hence they report their results as Q1 results. For comparative purposes, I have labelled them Q2 results.
Quarterly results don’t necessarily include operating or net profit information. The profit updates that have been released make for sobering reading.
- Manpower reported a Q2 operating loss of USD 64.4 million down from a USD 127.3 profit in Q2 2019.
- Randstad reported a Q2 operating loss of €69 million down from a €238 million profit in Q2 2019.
- SThree reported a 49% operating profit decline, from £23.3 million to £13.7 million, for H1 (1 December 2019 – 31 May 2020)
- Hays released full year (July 2019 – June 2020) operating profit guidance of £130-£135 million, down approximately 46% from £248 million in the 2019 FY
- Adecco reported a quarterly operating profit decline of 79%, from €241 million to €50 million
- Kelly reported a quarterly operating profit decline of 68.2%, from USD 34.8 million to USD 11.1 million
- Outsourcing reported a half-yearly operating profit decline of 40.3%
- PERSOL reported a quarterly operating profit decline of 9.4%
- PERSOLKELLY business (their brand for the APAC division) showed 23% growth on USD although reported an operating loss for Q2 of JPY 116 million (circa USD 1 million). Fully-owned subsidiary, PROGRAMMED, recorded a sales increase by about 7% on AUD basis.
Context with respect to the Kelly APAC results, as compared to the companies on this list, is seen in Kelly APAC total quarterly gross profit of $6.8 million.
The overall Kelly results were significantly less impacted due to their Global Talent Solutions (GTS) division, which accounts for 25 per cent of their global gross profit, recording a 3.8 per cent increase in their quarterly gross profit. Kelly GTS encompasses services across; Master Service Provider; Contingent Workforce Outsourcing; Recruitment Process; Outsourcing; Business Process Outsourcing; Advisory; and Talent Fulfillment solutions.
Across the globe, It’s hard to be optimistic that results will get better before they get worse with significant headcount reductions likely to continue for the rest of this year.
I suspect everybody in the global recruitment industry is already looking forward to 2021 with an optimistic air; surely it couldn’t be worse than this?
- Updated on 24 July 2020 to include Q2 2020 results for Robert Half
- Updated on 7 August 2020 to include Q2 results for Adecco and Kelly
- Updated on 10 August to include H1 results for Outsourcing
- Updated on 13 August to include Q2 results for PERSOL