Plant hire firms will axe 7,000 jobs during recession

Hire firms will axe more than 7,000 jobs as a result of the recession, warned a leading business analyst.

Plimsoll senior analyst David Pattison said that the downturn would inflict a heavy toll on jobs and warned hire companies would suffer a 30 per cent fall in business by the end of this year.

He said: “Businesses must plan for this reduction and get themselves in shape. This isn’t the time to renegotiate your debt and you don’t want to appear on the bank’s radar,” he said. 

“Even in a downturn, every business has an activity level at which it is profitable,” said Pattison.

“The trick is knowing that level, putting key performance indicators in place and getting the business in shape,” he added.

Other measures he advised included close management of debt levels, gross margins and debtor days.

Plimsoll’s Recession Edition Report
carries a survival strategy to help managers of each of the 1,500 hire companies studied understand how to get their businesses in shape for tough times ahead.

Strangely, Pattison said many companies would make more profit if they followed the advice as inefficiencies were tolerated during the boom.

His analysis shows 70 companies could be more profitable with 30% lower turnover and 450 have enough cash to buy time to make the necessary adjustments.

However, he predicted almost 400 companies will struggle as rising debts hamper their survival. 

Pattison said the report shows failure is avoidable, but companies need to act now to weather the storm.