City nervousness about pressure on bonuses, new taxes on banks and further regulatory action in the wake of the credit crisis does not appear to have precluded a rebound in hiring so far this year, with a leading recruitment agency reporting a strong improvement in business yesterday.
Robert Walters, the London-based agency that specialises in the financial services sector around the world, said its fee income in the UK rose by more than a third during the second quarter of the year, as City firms stepped up their hiring.
Giles Daubeney, the company's chief operating officer, said that although confidence remained fragile and he was still concerned about the outlook for the year ahead, there had been a marked improvement during recent months.
"In the wider market, what we need is business confidence," Mr Daubeney said. "In the second quarter we did see that, though we're not quite sure where the second half is going to go."
The boost to Robert Walters' UK figures came primarily from the financial services sector – both in traditional City roles and in support service functions such as legal and human resources.
The recruitment agency's own hiring policy also seems to be mirroring that of its clients: having shed almost a fifth of its staff during the recession, Robert Walters has raised employee numbers by 21 per cent since the beginning of the year.
Overall, Robert Walters said its fee income during the first half of 2010 totalled £72.3m, a 45 per cent increase on the same period last year.
Although the company remains nervous about the sustainability of the UK economic recovery – and thus the prospects for the financial services sector – it has bounced back strongly in Asia, where it is more confident that trading will continue to improve.
Robert Walters' income from its Asian operation rose 75 per cent to £19.5m during the first half of the year. "Asia will continue to grow," Mr Daubeney predicted.
The firm is the first of a string of recruitment agencies due to publish updates this week in a sector that is closely watched as a bellwether for the financial services sector and the wider economy. Hiring is one of the first casualties for businesses concerned about their prospects, particularly in the City, so headhunters are highly exposed to falling confidence.Reuse content