Like-for-like (LFL) fees growth at Hays has fallen by 14% globally in the first quarter of its 2025 financial year, as temporary and permanent recruitments dropped.

The recruitment firm said that its LFL recruitment fees had fallen year-on-year by 20% in the UK and Ireland, with temporary and permanent recruitment fees falling by 16% and 20% respectively.

Hays said that activity remained "subdued but sequentially stable" across the private sector, while temporary volumes "reduced modestly" in the three months to 30 September.

LFL fees growth also fell by 20% in Australia and New Zealand, and by 13% in Germany. Meanwhile, in its rest of the world division, growth dropped by 9%.

In a statement, chief executive at Hays, Dirk Hahn, said that net fees in the quarter were "down as expected", reflecting "tough market conditions", especially in its permanent recruitment division where it sees firms taking a "longer time to hire and low levels of confidence".

Hahn added: "Given this backdrop, we remain resolutely focused on operational rigour through business line prioritisation, resource allocation, and efficiency initiatives and, due to our actions, group consultant productivity increased by 5% year-on-year in Q1."

Looking ahead to the rest of the 2025 financial year, Hays said it expects near-term market conditions to "remain challenging", with activity levels across the business remaining at subdued levels.

In the UK and Ireland, the firm said that it has seen a modest reduction in the public sector, but the permanent sector "remains tough but stable". However, it added that there were "no clear signs" of improvement in activity.

As a result, Hays said that unless it sees a "material recovery in end markets", it will continue to expect pre-exceptional operating profit in H1 2025 to be "sequentially lower" than H2 2024.

Hahn concluded: "We have a strategy in place to build a structurally more profitable and resilient business underpinned by our culture and talented colleagues worldwide. So, I remain confident that the business will benefit materially when our end markets recover."

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