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Randstad Says North America May Become Firm’s Top Market

Randstad Holding NV CEO Ben Noteboom
Randstad Holding NV CEO Ben Noteboom said, “Our most important stake is the IT market in the U.S.” Source: Randstad Holding NV via Bloomberg

March 20 (Bloomberg) -- Randstad Holding NV, the world’s second-largest staffing provider, said North America may become the company’s biggest market this year because of an acquisition and faster economic growth in the U.S. than in Europe.

Hiring of professionals in the information-technology, engineering, and accounting industries has been increasing the fastest, enabling the company to build on eight consecutive quarters of U.S. sales growth, Chief Executive Officer Ben Noteboom said yesterday in an interview at Randstad headquarters in Diemen, Netherlands.

“We are almost back at the previous peak,” Noteboom, 53, said. “There is no sign that the rise in penetration will stop” as companies seek to grow while remaining flexible enough to match sudden changes in the economy.

Randstad, whose two biggest markets last year were France and the Netherlands, almost doubled its presence in the U.S. after buying Fort Lauderdale, Florida-based SFN Group Inc. for $771 million last year. Companies in the country have slowed the pace of firings and are expanding workforces as sales rise and the threat of financial contagion from a European sovereign-debt default diminishes.

Job growth in the U.S. in February capped the best six months since 2006, and the unemployment rate stayed at a three-year low of 8.3 percent, according to Labor Department figures released earlier this month.

Industry Ranking

“Structurally you see the biggest growth in the professional segment,” said Noteboom, who has led the company since 2003. “Our most important stake is the IT market in the U.S.”

Randstad, which ranks second in the global temporary-employment industry to Glattbrugg, Switzerland-based Adecco SA, derives 39 percent of its North American sales from providing temporary professional workers and 52 percent from placing non-professional temporary employees, including figures from SFN, the company said in July.

North American non-professional segment revenue rose 13 percent in January from a year earlier, while sales gains from placing professional workers accelerated to 15 percent from an average of 10 percent in the fourth quarter. SFN sales increased 6 percent. Revenue in France that month dropped 3.5 percent and Dutch sales fell 2 percent, the company said Feb. 16.

Integration Schedule

Randstad, which provided an average of 576,800 temporary workers daily in 40 countries last year, plans to start combining its North American professionals business with SFN in May. The integration is “going very well,” Noteboom said. “We haven’t had any accidents so far.”

In contrast to the declining U.S. unemployment figures, the jobless rate among euro-area countries rose to 10.7 percent in January from 10.6 percent in December, the European Union’s statistics office in Luxembourg said March 1. The region’s economy shrank in the fourth quarter as governments stepped up budget cuts, undermining hiring and consumer demand.

Dutch temporary-placement industry sales fell 3 percent in February as total hours worked declined 5 percent from a year earlier, the ABU Dutch association of staffing companies said today. The declines in January were the same.

Randstad shares fell 1 percent to 29.44 euros at 12:14 p.m. in Amsterdam. The shares have gained 29 percent this year after losing 42 percent in 2011.

To contact the reporter on this story: Jurjen van de Pol in Amsterdam at jvandepol@bloomberg.net

To contact the editor responsible for this story: James Ludden at jludden@bloomberg.net

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