Recruitment Struggles: Hay's Shares Plunge Amid German Auto Sector Woes
British recruiter Hays anticipates a significant drop in profits due to sluggish hiring, especially in Germany's auto sector. Factors include U.S. tariffs impacting Germany's economy and slow permanent hiring despite resilient temporary hiring. Shares fell 20%, affecting other European recruitment firms as well.
British recruitment agency Hays has issued a warning about its annual profit projections, forecasting a sharper decline than expected. This development comes amid sluggish hiring in Germany, particularly within the automotive sector, which has also driven the company's shares and those of its European competitors down.
The German auto sector is facing headwinds from U.S. tariffs and reduced demand, both of which are expected to slow the country's economic growth as well as affect employment numbers. Permanent hiring has been weak globally due to economic uncertainties, though temporary hiring shows more stability.
Hays' shares plummeted by 20% to a 13-year low after the warning was announced. The downward trend also affected shares of other recruitment firms like PageGroup and Randstad. Hays now projects an operating profit for the financial year end significantly below market expectations.
(With inputs from agencies.)
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