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Agency fees cap causes jobseekers to shun NHS posts, says Hays

Hays recruitment firm reports 7% rise in pre-tax profit but sees slowdown in use of temporary workers across UK public sector

Hays, the UK’s largest recruitment firm has found that jobseekers are shying away from posts in the NHS after a cap on salaries paid to agency staff.  The cap was introduced in November 2015 in an attempt to reduce costs.

Chief executive of Hays, Alistair Cox, reported pre-tax profit up 7% to £82.4m in the second half of 2015, on the back of 8% like-for-like growth in fees to £396.9m.

Fees in the UK were up a more modest 3% and Cox said this was partly down to weakness in the public sector. “We saw a slowdown in the use of temp workers in public sector amid the caps that have been introduced on salaries for workers in the health service,” he said.

“People are taking themselves out of the labour pool because the salary is not commensurate with unsociable hours they’re being asked to work.

Cox said fee growth in the UK had slowed during the half “as increased global uncertainty impacted sentiment”. But he added that the slowdown did not not necessarily signal an impending employment crisis. “I don’t see any reason why it would be prolonged subdued environment,” he said. “People still want to change jobs and clients still need the right people. The movement of labour is going to continue.”

Cox said that many firms had embarked on recruitment drives as the UK emerged from recession and the market had now taken a “pause for breath” amid economic uncertainty.  He added that Hays did not have a view on whether Britain should leave the EU.

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