Recruiters could record more of a profit on 30% less sales, according to a new report.

The report, from industry analyst firm Plimsoll, also shows that 174 firms will struggle to cope due to rising debts hampering their survival options. Meanwhile, several companies could see staff numbers cut by 40%, as costs come in line with sales. Up to 7,000 more jobs could also be at risk, while 554 cash rich companies remain in a strong position to weather the economic storm, allowing them more time to alter business models.

David Pattison, senior analyst at Plimsoll, said: “Companies need to act now, if they are going to weather this storm. As unpopular as job losses and cost reduction is, businesses will have little choice. What we have been able to show in our work is that failure is avoidable, as long as the necessary changes are implemented without delay.”

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