The global job market is experiencing its longest downturn in over 20 years, according to Dirk Hahn, CEO of Hays, Britain’s largest listed recruitment firm. Hahn attributes the slump to ongoing macroeconomic uncertainty, which is deterring both employers and job seekers from making moves.

Hays, which employs nearly 7,000 consultants worldwide, reported weaker demand for temporary workers in early 2025, while demand for permanent roles—particularly in Europe—remains sluggish following a pre-Christmas dip. Countries such as France, the UK, Ireland, and Germany, Hays’s largest market, are feeling the pressure most acutely.

In the six months leading up to December, Hays reported a 15% drop in group net fees, falling to £496 million from £583.3 million the previous year. Pre-tax profits fell sharply by 67% to £9.1 million, compared to £27.6 million during the same period the prior year. Hays’s share price, already down 25% over the past year, dipped a further 1.8% on Thursday, closing at 71¾p and placing the company’s market value just below £1.2 billion. Despite declining profits, the company will maintain its interim dividend at 0.95p per share.

While the broader UK labor market has shown resilience with limited mass layoffs, businesses remain cautious about expanding their workforce. “Most companies have enough work to retain their current staff, but they’re not looking to increase headcount,” said James Hilton, Hays’s chief financial officer. “Many employees who received pay increases in recent years are not seeking new roles, creating a stalemate. However, over time, people will seek promotions or fresh challenges.”

Recruiters had anticipated a market recovery earlier this year, but Hahn now warns that the rebound may not materialize until 2026. In the meantime, Hays is focusing on its technology recruitment division—its most profitable segment—as it navigates the prolonged global hiring slowdown.

The UK government reported a budget surplus of £15.4 billion in January, falling short of economists’ forecasts of £21 billion and the £19 billion predicted by the Office for Budget Responsibility (OBR). Despite January typically seeing a boost from self-assessment tax payments, the lower-than-expected figure has increased total borrowing for the financial year to £118.2 billion—over £11 billion more than the previous year.

The government’s debt-to-GDP ratio now stands at 95.3 per cent, a level last observed in the 1960s. With the OBR set to release updated forecasts on March 26, there are concerns that the government may struggle to meet its goal of reducing the debt ratio by 2029. This could lead to potential spending cuts or tax hikes in the autumn budget.

Reduced debt-servicing costs helped boost January’s surplus, dropping from £9 billion in December to £6.5 billion. However, this was partially offset by a £6 billion one-off expense related to the government’s repurchase of military housing from private firm Annington.

Darren Jones, chief secretary to the Treasury, emphasized the government’s commitment to “economic stability and meeting our non-negotiable fiscal rules.” He also noted that a comprehensive spending review—the first of its kind in 17 years—is underway to ensure that public funds are used efficiently and aligned with national priorities.

Lloyds Banking Group has reported a 20% decline in annual pre-tax profits for 2024, falling short of market expectations due to rising costs and a significant charge linked to the ongoing motor finance commission scandal.

The FTSE 100 lender posted profits of £5.97 billion, down from £7.5 billion in 2023 and below analysts’ forecasts of £6.4 billion. The bank’s income was affected by a lower net interest margin—the difference between interest earned on loans and the cost of funding—amid falling interest rates.

A key factor in the profit drop was an additional £700 million provision related to potential compensation for customers impacted by undisclosed or partially disclosed commissions on car loans. This charge brings Lloyds’ total provision for the issue to £1.15 billion. The case stems from a Court of Appeal ruling involving consumers Wrench, Johnson, and Hopcraft, who challenged lenders’ responsibility when credit brokers, such as car dealerships, fail to fully disclose commission details.

Chief Executive Charlie Nunn stated that the extra provision was a response to the appeal court’s decision, which went beyond the scope of the Financial Conduct Authority’s (FCA) initial review into motor finance commissions. Nunn acknowledged that “significant uncertainty” remains regarding the final financial impact of the scandal.

Despite these challenges, Lloyds reported growth in key areas. Loans and advances to customers increased by £10.2 billion over the year, reaching £459.9 billion, driven by a £6.1 billion rise in UK mortgages. Customer deposits also grew by £11.3 billion to £482.7 billion, reflecting solid consumer confidence in the UK’s largest high street bank.

The bank also noted an improving economic outlook, supported by recent growth in house prices and a more favourable assessment of risks such as inflation and interest rate volatility.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, commented that the additional provision had “clouded” what was otherwise a strong fourth quarter. However, Britzman highlighted that Lloyds had successfully improved its loan quality throughout the year, defying concerns that borrowers might struggle under the pressure of persistent inflation.

Despite the profit shortfall, Lloyds’ share price has risen by more than 40% over the past year, reflecting broader optimism within the banking sector and the company’s consistent performance outside the motor finance charge.