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PageGroup profits tumble 89% after Covid-19 batters jobs market

The recruitment firm reported pre-tax profits plunging to £15.5m for 2020 from £144.2m in 2019.

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Recruitment firm PageGroup has revealed that annual profits crashed 89% after the pandemic hammered the global jobs market (Ian West/PA)

Recruitment firm PageGroup has revealed that annual profits crashed 89% after the pandemic hammered the global jobs market (Ian West/PA)

Recruitment firm PageGroup has revealed that annual profits crashed 89% after the pandemic hammered the global jobs market (Ian West/PA)

Recruitment firm PageGroup has revealed that annual profits crashed 89% after the pandemic hammered the global jobs market.

The company reported pre-tax profits plunging to £15.5 million for 2020 from £144.2 million in 2019 after revenues slumped 21%.

It said the UK recruitment market and the Americas were the hardest hit of its global operations.

Gross profits in Britain – which accounts for 13% of group fees – tumbled 40% as Brexit worries ahead of the year-end deal deadline also weighed on the jobs sector, leaving the division nursing operating losses of £10.3 million.

But it said costs were slashed in response to the coronavirus crisis, with nearly 1,300 jobs axed and many employees taking 20% salary cuts.

It cut 15% of its fee-earner jobs worldwide, although the headcount was 882 lower at the end of 2020 after taking account of around 400 experienced hires.

There remains a high degree of global macro-economic uncertainty in many of our markets ... However, in the UK we are encouraged that the Brexit deal and the recent Government announcements about lockdown easing have provided a degree of claritySteve Ingham, PageGroup

Despite the impact of the crisis on its bottom line, PageGroup said it ended the year with a strong balance sheet and announced that it would repay £3.4 million of furlough support as a result.

It added that it would restart paying dividends to shareholders “as market conditions improve and greater clarity over the trading outlook is restored”.

Chief executive Steve Ingham said: “As we enter 2021, there remains a high degree of global macro-economic uncertainty in many of our markets, with Covid-19 still a significant global issue and a number of the group’s markets in lockdown.

“However, in the UK we are encouraged that the Brexit deal and the recent Government announcements about lockdown easing have provided a degree of clarity.”

The results showed that the UK division saw gross profits decline 44% across the lower salary Page Personnel brand, with a 39% drop for Michael Page, which is focused on more senior jobs.

PageGroup said: “There remains opportunity to roll out new discipline businesses under the lower salary-level Page Personnel brand, which now represents 24% of UK gross profit.”

Its UK headcount dropped 11.4% to 1,175 at the end of December 2020, with fee-earner roles cut by 105.

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