PageGroup has warned it does not expect any immediate performance improvement as the recruiter scaled back profit expectations after sales suffered further in the first-half.

The Surrey-based firm was forced to accelerate job losses the second quarter as performance weakened further across all of its major global markets, with PageGroup citing 'tightened' recruitment budgets and a 'risk-averse' client base.

And in the UK, where PageGroup has seen 'headcount decreases', performance was particularly weak with 'clients deferring hiring decisions and candidates cautious about accepting offers'.

FTSE 250-listed PageGroup shares were down more than 11 per cent to 375p in early trading, bringing 2024 losses to around 21 per cent. 

'Uncertain macro-economic conditions', PageGroup said, had led to a 9.8 per cent fall in global temporary hires in the three months to 30 June as permanent hiring dropped 12.8 per cent.

UK permanent recruitment was down 16 per cent over the period, but was more resilient than temporary recruitment where hires plummeted 21 per cent.

It follows an Institute of Directors survey that showed UK economic optimism had slumped to a four-month low in June with bosses particularly pessimistic about hiring plans in the year ahead.

PageGroup said: 'We continued to see tough market conditions in the majority of the Group's markets with no immediate signs of improvement.

'As clients' recruitment budgets have tightened, they have become more risk averse which has slowed the recruitment process. 

'Although salary levels remain strong, offers made to candidates were not as elevated as they were in 2022 and early 2023.'

PageGroup posted a gross profit for the second quarter of £224.3million, down 12 per cent year-on-year on a constant currency basis.

In the UK, where the business derives 12 per cent of its gross profit, profits fell 17.4 per cent year-on-year to £26.8million – following a 19.2 per cent drop in the first quarter.

Foreign exchange movements also cost PageGroup £7.9million during the period.

As a result, its first half profit was down 12.4 per cent to £444.2milllion as UK earnings slumped 18.5 per cent to £53.7million.

PageGroup now expects to post an operating profit of around £60million for 2024, down from £118.8million last year.

It told investors it cut another 153 jobs during the period, up from 100 in the previous three months and putting PageGroup on track to have lost almost 1,500 roles since its employee numbers peaked at 7,071 in late 2022.

Boss Nicholas Kirk said: 'While we saw a slower end to the quarter, having taken action to reduce headcount throughout last year, our intention is to broadly hold fee earners at existing levels to ensure we are well placed to take advantage of opportunities as sentiment and confidence improve.

'We have a highly diversified and adaptable business model, a highly experienced management team, a strong balance sheet and our cost base is under continuous review.'