UK general election: Uncertainty among businesses rises

Election jitters have started to weigh on UK businesses with the vote less than a month away, according to one of the country's largest recruitment firms.

Hays, the £2.3bn group that specialises in finance, construction and technology recruiting, said on Friday that while conditions remain "good" in the UK, it has "seen more cautious decision making amongst certain client and candidate segments as we get closer to the upcoming general election".

The commentary follows recent polls that have the Labour and Conservative parties in a neck-to-neck race, with a possibility that neither will secure enough seats to lead a government on its own.

The election has introduced a wave of uncertainty - particularly in currency markets - which could keep hiring managers from finalising job candidate decisions until after the May 7 vote.

Investor concerns have increased that an outright Labour victory or Labour-led coalition government could hinder the financial sector, as Ed Miliband seeks to break the hold the biggest banks have on the UK market.

Accountancy and finance represents Hays largest speciality within the UK, and the company said there were signs of caution in both the private and public sectors.

Results covering the three months to the end of March, when the Queen officially dissolved Parliament, showed an 8 per cent rise in net fees from the UK and Ireland. Fees climbed by a double-digit percentage in the north, Midlands and the east. City of London fees advanced 8 per cent from a year earlier.

Hays said overall fees rose 5 per cent from a year earlier, buoyed by permanent job placement in the UK.

Fee growth in Asia as well as its "Continental Europe and rest of world" regions climbed 5 and 3 per cent, respectively, both slightly lowered by currency fluctuations. Hays tallied growth above 10 per cent in 15 countries, including France, China, Japan and the US.

The company said it would "deliver strong operating profit growth for the full year", with profits in the second half slightly ahead of the first, according to a statement.

"We continue to see good levels of net fee growth, many clear opportunities remain," Alistair Cox, chief executive, said. "Our focus remains on selectively increasing consultant capacity in the many areas where we see opportunities for growth."

Shares of the company have climbed 13 per cent since the year began, outpacing the 7 per cent gain by the FTSE 100.

The results follow those from competitor Robert Walters, which said recently that it expected full-year profits to eclipse analysts' forecasts after a strong start to the first quarter.

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