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July 6 (Reuters) - Low employer confidence and significant candidate shortages in the UK, coupled with waning demand for tech specialists, squeezed British recruiter Robert Walters in the second quarter, sending its quarterly net fees down 10%.
Many technology companies have trimmed their workforces in recent months, hurting Robert Walters which is also grappling with companies getting more reluctant to hire against an uncertain economic backdrop marked by rising interest rates. Last month, the company which specialises in the legal, accountancy and technology sectors, warned that yearly profit would be significantly lower than market expectations, citing an increased reluctance to make potentially risky job moves and lengthening time to hire.
Those trends are still not showing the anticipated signs of sustained improvement, Chief Executive Officer Toby Fowlston said on Thursday.
Demand for artificial intelligence-related jobs is also not moving at any great speed, despite the buzz around the technology, Fowlston added.
Shares in Robert Walters were down 1.6% by 0935 GMT. In the same sector, Hays, Pagegroup and Sthree fell about 1%.
Robert Walters said total net fee income for the three months to June fell to 99.9 million pounds ($127 million). In the UK it reported a 21% drop, while across continental Europe fees were flat on a constant currency basis.
Fowlston said markets like the United States and China had been particularly challenging due to uncertain economic conditions. Net fee income from mainland China was down 37%.
Still, the legal sector remained a bright spot thanks to increasing demand in jobs related to risk regulation, compliance and cybersecurity.
"We're seeing a lot of lawyers moving from practice into in- house roles, and the increasing insurgence of U.S. firms who generally offer slightly higher salaries is creating more competition in the domestic market," Fowlston said.
