Permanent staffing market is picking up, but caution still needs to be taken
Things are looking cautiously positive. Business lending is growing, our clients are seeing an increase in assignment levels and some are finding that permanent staff placements are picking up. But the positive outlook still needs to be treated with a level of caution.
The Asset Based Finance Association’s quarter two stats show that lending to businesses is growing, with total advances from ABFA members (including Lloyds TSB Commercial Finance) at £14.59 billion this quarter, a growth of two per cent from this time last year. ABFA members are now advancing more than they were at any time in the last year. This growth indicates that members’ clients, many of whom are in the recruitment finance sector, are feeling more confident about drawing on funds available to them.
This year we’ve experienced a steady upward trend – business is certainly picking up for our clients too. The increase in assignment levels has been witnessed through our clients using our pay and bill services as well as our invoice finance product. In addition to this, it also seems the permanent staffing market is finally picking up.
However caution needs to be taken, especially around the current uncertainty of the public sector.
The administration of Connaught is said to be the first casualty of the spending cuts. Suppliers of Connaught will need to take stock of their overall financial position, especially cash, and ensure they are talking to funders to minimise the financial impact and prevent business failure. It will be interesting to see how this and other spending cuts from the CSR will impact on the recruitment sector.
We are also currently seeing a marginal cooling off in terms of the growth in invoicing; this is partly because of the summer vacation periods but might possibly be the early warnings of some spending freezes. It is too early to generalise but it does again reinforce the absolute need to continue to spend very prudently.
For more information on how Recruitment Finance can help you contact our team on 0800 587 6033.