Shares in recruiter Michael Page fell almost 5% today after a hiring freeze among struggling financial services firms halved its banking profits in the first three months of the year.
Financial services firms — which account for around 8% of Page’s profit — axed thousands of jobs last year and have not yet started hiring again.
“Market conditions generally remained tough, with the banking sector particularly depressed,” the business announced in a statement.
In the UK, year-on-year gross profit from banking plunged by 50% in the first quarter, and overall gross profit in this country — which represents nearly a quarter of Page’s business — fell 3.7% to £30.6 million in the first three months of 2012.
Around the world, Page’s banking division — which operates in New York, Tokyo, Hong Kong and Singapore as well as in London — declined by 12%. Growth in IT, engineering and mining jobs in Germany, France, China and Australasia helped the recruiter’s gross profit rise 6.9% to £136 million in the three months to April. In Asia, which provides nearly a fifth of group profit, first-quarter gross profit rose 23% to £26.3 million.
But Steve Ingham, chief executive, admitted: “As in the UK and North America, the weakness in the banking sector also reduced our growth rates in Asia… Markets continue to be weak and visibility remains limited, however, the group remains financially strong.”
He added that the firm remains committed to “investing in developing business, opening offices in Taipei and Suzhou, in Asia, Casablanca, in Morocco and Bogota, in Colombia”. Shares in Michael Page fell 20.7p to 433.2p.
