Job cuts in the banking sector was how the finance boss of recruitment giant Hays yesterday explained the 7 per cent decline in UK business during the last quarter of 2011.
"It's a musical chairs business – we need someone to leave before we can replace them, and in many cases they are not," Paul Venables, Hays' finance director, said.
"Fees are down mainly thanks to a weakening in the City. "It's a weakening confidence, and clients making a clear decision to reduce the number of permanent staff.
"Until confidence improves, we'll see subdued demand."
Strong growth in the mining industry in Australia, plus booming Germany and France, which grew earnings by 28 per cent and 20 per cent respectively, helped Hays post a 9 per cent jump in net fees during the last three months of 2011.
But even Asia saw growth slow dramatically, down from 34 per cent in the third quarter to 16 per cent in October, November and December.
"Three months ago, banks in Asia were looking to increase their headcount aggressively but now – even there – they are being very selective about hiring," Mr Venables said.
Asia is still a big draw for expat bankers, however. Hays said more than 50 per cent of the banking jobs it filled in Singapore last year were taken by executives from the City or, to a lesser extent, Australia.
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