A tide of legislation could kill smaller recruitment companies, Adecco's UK managing director has warned.

Steven Kirkpatrick, who has been in the job just over a year, believes that recruitment professionals are spending too much time and money dealing with red tape, with margins eroding in the process.

"The costs are going up but there's no 'give' at the other end," Kirkpatrick told Recruiter in an exclusive interview.

"We are already seeing that margins are going down and this could be fatal for smaller businesses."

Despite the widely-held belief that the recruitment market is buoyant, Kirkpatrick said this is not necessarily the case.

"People talk about a 6% increase as the market being buoyant, but if you take wage inflation of 3% out of that, you see that the market is almost flat," Kirkpatrick explained.

"By contrast, we are at 16% growth across the country."

Kirkpatrick claimed recruiters in the south are catching up with their counterparts in the north in terms of growth.

Areas such as Scotland - which had three Adecco branches three years ago but now has 14 - and the North-East experienced 20% growth last year. The south coast could only manage single figures, but Kirkpatrick believes the gap is narrowing.

"Traditionally, the North adapts to change quicker but the South is catching up."