We are not (yet) seeing the effects of the credit crunch (reduced 'ceilings' on borrowings) in the way we think was indicated by Kevin Barrow. Indeed, our international bankers seem happy to lend to the UK recruitment sector, provided that the quality of the business is good. What we are seeing is reduced credit limits for clients using the recruitment sector to supply them, as credit rating and credit insurance companies are reviewing their exposure. If our analysis is correct then recruitment companies can protect their cash availability by attempting to broaden rather than deepen their client base.

Tom Atkinson