Recruiters’ Results Show Thorny Outlook With Tentative Green Shoots

This content was published on August 8, 2025 - 14:30

3 minutes

(Bloomberg) — Recruiters across Europe and the US showed timid signs of stabilization in the second quarter after a dismal start to the year. Any reversal of fortunes still hinges on a drastic improvement in the second half.

ManpowerGroup Inc., Robert Half Inc. and Adecco Group AG reported modest sequential earnings growth as employers began to adjust to geopolitical and economic volatility.

Adecco beat second-quarter earnings expectations, citing faster-than-expected growth in flexible placements, and anticipates better profitability in the second half.

Dutch rival Randstad NV echoed the sentiment, reporting stable sequential gross profit. “The mood is ticking up slightly,” which could drive demand for temporary roles, Chief Executive Officer Sander van’t Noordende said on an earnings call.

Manpower’s results surpassed projections. CEO Jonas Prising said companies are now adjusting to unforeseen shocks with more ease.

Still, the tone across the sector remained cautious, with firms warning of persistent challenges ahead. Prising said the North American market, while “resilient,” is cooling, and conditions in Northern Europe are “very tough.”

“We are in a weird vacuum where I’m not sure if things get worse, but there needs to be green shoots for investors to return,” Bloomberg Intelligence analyst Stuart Gordon said. “If we started to see a recovery in the back half of this year, next year would still be reasonable.”

Robert Walters Group Plc didn’t inspire confidence, with gross profit falling 16% in the first half because of weak hiring activity in Europe. The firm canceled its interim dividend and warned that no material improvement in hiring is expected in the near term.

Robert Half’s third-quarter outlook came in below expectations, and comments that small business confidence levels are rebounding failed to encourage shareholders, with shares down 19% since its results and 51% this year.

Sluggish Job Markets

While US hiring rose overall in July, job gains slowed in manufacturing and professional services — key sectors for Manpower and Robert Half. Tariffs are weighing on factory jobs, while artificial intelligence and business uncertainty are dampening white-collar hiring, BI analysts Gordon and Evgeniy Batchvarov wrote in a note. Unemployment also ticked higher.

In Europe, the picture is bleaker. The UK’s unemployment rate reached a four-year high, while hiring remained sluggish in France and Germany.

UK job vacancies in the three months through June fell further below Covid levels, hurt by a steep minimum wage hike and the Labour government’s £26 billion ($35 billion) payroll tax increase. “I fear we’ve not seen the worst for the UK yet,” Gordon said, citing rising labor costs.

With consumer and business confidence oscillating, and uncertainty lingering around President Donald Trump’s trade policy shifts, a broad recovery in recruitment may still be some way off.

Next quarter’s earnings may determine whether the sector will finally turns the corner. “When these guys do bounce off the trough, they bounce very, very quickly,” Gordon said.