AI is a worry for many workers and 'front of mind' for employers, Manpower says

By Tomi Kilgore

Companies are prioritizing the hiring of people with flexible skills and an adaptable mindset, Manpower said

In headhunter Manpower Inc.'s post-earnings call with analysts, Chief Executive Jonas Prising addressed what everyone was thinking, how artificial intelligence was affecting the job market.

"[W]hile the promise of AI is yet to be realized, it is front of mind for businesses across every industry," Prising said, according to an AlphaSense transcript.

While he was convinced the potential of the AI at scale will be realized, he believes, however, that AI really only "augments" human capabilities and skills.

Prising said many companies are developing their current workforce with this in mind, while "selectively" adding new workers.

"Priority is placed on retaining and attracting workers with specialized, flexible skills and an adaptable mindset to adjust to the evolving requirements in the workplace," Prising said.

Manpower's stock (MAN) tacked on 0.5% in afternoon trading, erasing an earlier intraday loss of as much as 2.7%. It has now rallied 12.5% amid a seven-session win streak, which would be the longest such streak since the nine-day stretch that ended July 19, 2023.

He said Manpower research finds that more than 60% of employers believe AI and machine learning will be good for business performance, and 70% plan to boost "upskilling efforts" to take advantage.

At the same time, "our surveys also tell us that 43% of workers feel neutral or negative about AI's impact on their jobs and futures," Prising said.

His comments come has Manpower reported a second-quarter profit that topped Wall Street's expectations, but revenue that fell a bit shy.

In the overall marketplace for jobs, Prising said there has been a growing focus among employers to on keep and develop their current employees, and there is still no sign of an inflection point of improvement in demand for new hires.

"Permanent recruitment activity softened slightly further from the previous quarter, while staffing and solutions activity remained relatively stable across most of our large markets," Prising said.

Net income for the quarter to June 30 fell to $60.1 million, or $1.24 a share, from $65.2 million, or $1.29 a share, in the same period a year ago. Excluding a one-time loss related to the Proservia Germany business, adjusted earnings per share of $1.30 beat the FactSet consensus of $1.27.

Revenue declined 6.9% to $4.521 billion, just below the FactSet consensus of $4.531 billion.

In the U.S., sales fell 1.7% to $697 million.

The stock's current win streak kicked off after it had closed at a two-year low of $66.26 on July 9. The stock has now lost slipped 6.2% year to date, while the S&P 500 index SPX has advanced 16.5%.

-Tomi Kilgore

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07-18-24 1357ET

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