SThree profits surge as supply chain crisis fuels demand for tech workers

Sthree growth has been driven by demand for jobs in software engineering as firms automate their supply chains (SThree)

STEM recruitment firm SThree saw a surge in profits as businesses turn to recruitment agencies to plug skills shortages amid continued supply chain disruption.

The London-based firm reported pre-tax profits of £44.3 million in the first six months of 2022, up 64% on the previous year, while revenue increased 27% to hit £772 million.

The growth has been driven by demand for jobs in software engineering as firms automate their supply chains as well as demand for life sciences skills after a rush of investment into pharma companies on the back of the coronavirus pandemic.

77% of the firm’s fees relate to arranging short-term contracts for recruits, an increase of 4% on the previous year, as firms take on fewer permanent staff amid uncertain economic conditions. Demand for contractors has grown 24% in the year to March 2022, SThree said.

SThree CEO Timo Lehne told the Standard: “Relatively quickly after Covid came in, the demand for specialist STEM talent increased.

“The major problem customers have is trying to bring their supply chains back to Europe as they’ve been quite global – that’s a multi-year journey for businesses.”

Three in four small and medium sized companies plan to reshore some of their supply chains back to the UK within five years, according to a NatWest survey, while one in two said they had already switched to UK suppliers as part of their efforts to reduce their carbon footprint.

SThree’s growth has also been fuelled by strong demand for skilled jobs in renewable energy, as European countries threatened with shrinking gas supplies from Russia intensify their efforts to install wind turbines and solar panels.

SThree shares climbed 3% to hit 400 p in early trading.