Manpower companies struggling to ride out the recession storm.

August 26th, 2009 by tom | Filed under Daily News, Employment, Recession, UK Small Business, UK employment.

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Before the UK economy moved into its current downturn, manpower companies were the cock of the walk. It would be fair to say that the last eighteen months to two years have been very difficult for these companies, with many of them going to the wall. However, three of the main players in the manpower industry in the UK have survived the recession, not without difficulty, and are now raising their heads to see which direction they should take, as British business begins to shake the recession off its back.

Before the global economic downturn, the three market leaders in outsourcing, Adecco, Manpower and Randstad, flourished due to their ability to free employers from the shackles of employee-biased labour laws as well as in the changes in hiring practices imposed on them by the Labour government.

Since the turn-down, companies have not exactly been beating a path to their door, as employees, happy to hold on to their jobs under almost any conditions, have become decidedly less adamant.

Evidence of these companies’ weakness in the market is the news that the world’s biggest staffing company, Adecco, announced a €147 million loss for the second quarter, causing shares in the Zurich-based group to plummet by 5 percent on the day.

Turnover at Adecco dropped by almost a third for the period, as clients, particularly in the hard-hit automotive and aerospace industries, cut back on temporary workers, rather than choosing the politically sensitive option of cutting back on full-time staff.

Yet Addeco’s management, as well as those at Manpower and Randstad, remain optimistic for the future, believing that as the European economy moves slowly out of the recession their role in the business community as a provider of short-term manpower solutions will return in more or less the same format.

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