The RIB February Report provided positive indicators with transaction volumes for both Contractors/Temps and Permanent ICT placements; which was an improvement from January’s results.
However, Nigel Harse, RIB Report, cautioned “that this result is coming off a four year low and the number of participants trading at a loss for the month still remains high at 39%, but any improvement on the January results should be cause for at least a smile.”
Julie Mills added that, “ICT recruiters cannot be complacent as the results indicate the sector has also felt pain with profit before tax as a percentage of sales falling from 3.5% last year to 3.2% so far this year. Profitability for many in the industry generally is starting to look a little concerning as the year to date decline has been significant with the RIB Average falling from 5.3% last year to 3.3% year to date.”
Harse and Mills both agree that “falling volumes and high staff turnover throughout the year are making their damaging mark on productivity and this has been noted across many other reports.”
Global economic caution and continued sluggish domestic employer confidence is starting to show in the poor results that are being reported for permanent placements.
Both Mills and Harse conclude “that the IT contract and recruitment sector is continuing to soften but not at the same trajectory as the market generally.”
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