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Value of recruitment companies down
Date: 04 May 2010
Almost two-thirds of the top 1,000 recruiters are worth less than last year while 359 agencies lost more than a third of their value.
According to new research by analysts Plimsoll 628 recruitment companies have lost value in the last 12 months while just 365 managed to increase theirs.
David Pattison, senior analyst at Plimsoll, said: “It’s not surprising that the value of companies have taken a pounding recently but the extent of the squeeze is striking. Only 365 companies managed to increase their value – a record low.
“A number of factors have affected values. As demand slackened and companies were inclined to protect their market share, many saw profitability fall as a result. Declining margins have been the biggest weight on values in the market. The 359 companies that have suffered 30 per cent and more falls in their value have all seen their profit margins plunge too.”
Pattison suggests it is not all gloom: “Despite it all, 365 companies are now worth more than they were last year. Considering the malaise in the market over recent years that is a quite remarkable achievement. I hope it points to better times ahead.
“Valuing a company during the turbulence of the past few years has been a ‘finger in the air’ exercise in guesswork. With conditions now more stable, we have released the study to show how much each company in the UK Recruitment Agencies industry is worth and what affect the recession has had on their health.”
