So, what to write about a fortnight during which time you’ve mainly sat on a beach in Cornwall, eaten pasties and (debatably) learned how to surf? Particularly if the rest of the world has also been on holiday and news flow from the staffing sector has been minimal. And the guys from FiveTen have rescheduled your evening drinks (due to an unhealthy infatuation with Andy Murray) and your hopes for a few interesting insights have been dashed.

What struck me when returning back to the office is that the pace of acquisition activity has continued (see last issue’s City Comment, Recruiter, 24 June). As I highlighted last month, takeover activity traditionally picks up as confidence returns to equity markets and recent developments in the staffing sector suggest an interesting 12 months are in prospect.

The Q2 mergers & acquisitions (M&A) revival includes two public-to-private transactions (OPD and FDM), Korn/Ferry’s acquisition of Whitehead Mann and Hanover Search & Selection’s purchase of Napier Scott. This is an interesting development as confidence in the trading outlook needs to be strong before a company contemplates buying its competitors.

Hanover and Napier Scott are financial services specialists and, according to the press release, “we are currently seeing positive signs in the market and increased hiring requirements from both new and existing clients”.

This concurs with my own experience (stockbrokers are aggressively hiring in equity sales and research at the moment) and comments made to me by a finance director this morning that his firm saw evidence “across the globe of improved activity in financial services at the end of Q2”.

Although some sectors of the labour market are showing tentative signs of improvement, the unfortunate fact is that other areas are still suffering, particularly in European markets. Despite aggressive cost and headcount reductions over the past 12 months, the brutal decline in net fees during the first half of 2009 is likely to have decimated profitability.

Going into the July/August results season investors should already be aware of this. History suggests that share prices will react negatively when the full extent of the pain is revealed.