Hays and Michael Page, the UK's two largest recruitment companies have reported that demand for full-time employees is down.
The economic slump has hurt the market for permanent jobs in the past quarter, causing profits to slide at Hays and Michael Page. The recruitment agencies said both major players in the supply of IT staff.
"Market conditions became noticeably more difficult during the fourth quarter with many jobs being cancelled or put on hold," said Steve Ingham, Michael Page chief executive.
"The impact of the financial crisis is now evident in virtually every market and discipline in which we operate, albeit to varying degrees and with different markets and disciplines at different points in the downturn."
However, both have seen less gloom in the market for temporary jobs, and put this down to employers being "nervous" about signing long-term commitments. Michael Page reported temporary staffing profits grew by 13 percent in the fourth quarter of 2008.
"We delivered a resilient performance in the second quarter in the context of an increasingly difficult economic environment," said Hays chief executive Alistair Cox. "Overall, Group net fees fell by six per cent as market conditions deteriorated in most countries we operate."
Hays experienced growth in its public sector business, which represents 30 percent of its fees.
With fees falling, Hays and Michael Page have reduced their own headcount in line with the worsening permanent jobs market. Michael Page has reduced its staff by 509 individuals and Hays by 500.
Michael Page reported a slide in gross profits of seven percent to £118.8 million in its report on the fourth quarter. In a sign of how fast the current recession has descended on all industry sectors at the end of the first quarter of 2008, Michael Page reported a gross profit of £140.3 million, an increase of 33 percent from the same period in 2007.
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