Two major firms make redundancies and others freeze recruiting

Architects have become the latest group to be hit by the credit crunch, with two major firms making redundancies and a number of others freezing recruitment.

Hamiltons, the UK’s fifth largest practice, admitted that 16 staff members would leave the company, while listed rival Aukett Fitzroy Robinson said redundancies were inevitable, given the state of the UK market.

Both said they had frozen recruitment. 3D Reid and Benoy are also understood to have suspended recruitment in the UK, along with many others. Skidmore, Owings & Merrill said it had frozen recruitment in the UK, but was now advertising again owing to new work coming in from the Middle East.

Hamiltons grew from a 50-person practice in 2006 to a 250-strong firm this year, but Paul Birch, its director, said exposure to the UK residential market meant it had been forced to “consolidate”.

He said: “There has been a slowdown, so we are taking measures to address it, but we are aware of what happens during these times. We have lots of work on and are looking to maintain a level on the strong base that we have.”

Aukett Fitzroy Robinson, one of the UK’s few listed architects, revealed sobering interim results this week, with pre-tax profit down 11% and operating margins down 2%. It blamed this on “lengthening project programmes and planning permission delays on a number of major UK projects”.

Nicholas Thompson, the firm’s chief executive, said its resulting “operational reorganisation” would likely to mean further redundancies. He said: “If the sector goes down you have to change the teams into a different form. One has to cut at the margins.”

Thompson predicted that work in Russia and the Middle East would lead to a rise in the firm’s fortunes by the end of the year.

Comment: Del Hossain gives a recruiter’s perspective

Many people are saying we’ll do the work we have with the staff we have, as nobody knows what’s round the corner. The bigger architects are still recruiting, but being more selective. Before, the onus was just to get as many people as you could. Now, people are being more strategic, freezing recruitment in parts of the business but not in others.

But maybe competition was too intense last year. At the height of it, there were large firms recruiting students on the basis of how well they did in their first-year exams. We even heard of people being given golden hellos, all that sort of thing. Now that the market has calmed down a bit, companies aren’t having to outdo each other.

Del Hossain, managing director of architectural recruitment firm Adrem