Swiss temp agency Adecco sees ‘challenging’ Q3 as growth slows

Slowing demand for casual workers in Europe crimped revenue growth at the world's biggest temporary staffing agency Adecco, the Swiss firm said on Tuesday.

Swiss temp agency Adecco sees 'challenging' Q3 as growth slows
France was a bright spot for the firm in quarter 3, Adecco said. File photo: AFP

But net profits more than doubled in the three months through September, compared with a year earlier, to €270 million ($310 million), bolstered by the sale of its remaining stake in management services provider Beeline. 

The company, which saw revenues climb 2 percent on a year earlier to €5.9 billion, said outperformance in its largest market France had partly helped cushion the effects of softer demand elsewhere in Europe in the quarter.    

“As we communicated during our September investor seminar, trading in (the third quarter) was challenging, with growth slowing in a number of European markets. Against this backdrop, overall the Group delivered a solid performance,” said the firm's chief executive Alain Dehaze.

The performance of temporary employment agencies can show trends in demand in other sectors as they seek additional staff to meet orders.

Revenues in France grew 5 percent to 1.5 billion, slowing from 8 percent in the previous quarter, with the firm saying manufacturing and automotive demand helped drive its performance in the quarter.

Combined revenues for the German and Austrian markets fell 6 percent in the quarter, with a constriction in the automotive sector, regulation changes and consolidation in its operations, the firm said. 

Net profits were supported by the one off sale of Adecco's remaining 43 percent ownership interest in Beeline, which completed in August and netted €113 million. 

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Jobs: Why Zurich has rebounded better than other Swiss cities from Covid

The Covid pandemic hit Switzerland hard, although the country's largest city has rebounded strongly.

Jobs: Why Zurich has rebounded better than other Swiss cities from Covid

Measures imposed due to the Covid pandemic, which began in earnest in February 2020, shuttered businesses across the country and pushed many people out of work. 

When most notable Covid rules were relaxed in Switzerland in mid-February 2022, the economic recovery – highlighted by a strong job market – began in earnest in 2021. 

READ MORE: How the Swiss job market rebounded from the Covid pandemic

Nowhere was this more evident than Zurich, Switzerland’s largest and most economically powerful city. 

How did Zurich rebound from the Covid pandemic in comparison to the rest of the country?

Even though Zurich, along with other large Swiss cities like Geneva, Basel, Bern and Lausanne, have been hit hard by the pandemic from the employment perspective, Zurich’s labour market is now growing faster than in other urban centres.

One of the reasons for this upward trend is that young, well-educated foreigners are coming back.

In the first nine months of 2021, the city’s population grew significantly.

In September alone, it recorded 2,200 additional residents.

This is mainly due to people with a B residence permit, according to Klemens Rosin, methodologist at Zurich’s Statistics Office.

During the crisis, far fewer of them left the city. “This group is made up of well-educated, younger and mobile foreigners who have made a significant contribution to Zurich’s growth”, Rosin said.

Zurich’s employment market is expect to grow even further.

READ MORE: How hard is finding work in Zurich without speaking German?

That’s because in the coming years, many Zurich workers will retire — an estimated  210,000 by year 2050 — creating more job opportunities for younger employees.

In fact, according to a study commissioned by the canton in 2021, if Zurich’s economy is to continue to flourish, it will need around 1.37 million workers by mid-century.

If these vacancies will not be filled, then income, tax revenue and the financing of social security programs will be impacted.

READ MORE: Have your say: What’s the best way to find a job in Zurich

While it is difficult to predict what jobs will be most in demand in 2050 — what new technologies will emerge in the meantime — right now and in medium term, IT workers will be especially needed, experts say, because businesses will continue to to digitalise and automate.

Lower skilled jobs will also be in higher demand, including hospitality, retail and transport. 

With hundreds of thousands of vacancies to fill, people with the permission to work in Switzerland are likely to be flush with offers – particularly skilled workers with recognised qualifications. 

READ MORE: Why finding a job in Switzerland is set to become easier