US-based headhunter Korn/Ferry International has announced it will axe 500 employees, a fifth of its workforce.

Korn/Ferry ran into difficulties when hiring freezes and lay-offs in the US meant that employers were faced with a glut of candidates for jobs.

Newly appointed chairman and chief executive Paul Reilly, who took the post in June, said there was little sign of market conditions improving in the short term.

The company has also cut executive salaries by 10% in a move to cut costs by $38m a year.

Korn/Ferry’s announcement follows the news in June that headhunter Heidrick & Struggles was cutting its workforce by 13%.