ISG is recruiting in every division except construction, says its chief executive David Lawther, who predicts a 10% drop in regional work over the next six months

As the company reported a 7% drop in turnover for the year to 30 June, Lawther said: “We’re recruiting in food retail, bank retail, London fit-out, Europe and Asia. Construction is the only business we’re not recruiting in and yes, it’s going to have a hard time.”

Turnover fell from £1.05bn to £972m while pre-tax profit was £8.7m, down from £11.8m in 2009. Its order book, 30% of which is public sector, stood at £742m compared with £822m last year.

But its regional construction business, which accounts for a third of the firm’s turnover, is weighted 62% towards the public sector. The division recorded turnover of £338m (2009: £367m) and an operating profit of £3.5m (£3m). Its order book was £276m compared with £286m in 2009.

Lawther said: “We are seeing the odd scheme starting to come back in the regions, but obviously there is the public sector issue.”

Meanwhile turnover at its London fit-out division edged up 4% to £170m although an increasingly competitive market meant it suffered from a lower profit margin of 1.9% (2009: 2.6%).