As international recruiter Empresaria Group sees revenues rise due to strong growth in international markets, the UK faces a challenge to retain top talent, according to its chief executive Miles Hunt.

Ahead of its preliminary results for the period expected on 31 March 2011, the Empresaria group reports:

• Full year revenues up 17% to £223m (2009: £191m)
• Second half revenues from continuing businesses up 14% to £115m (H2 2009: £101m)
• Full-year net fee income up 20% to £49m (2009: £41m)
• Second half net fee income from continuing businesses up 14% to £25m (H2 2009: £22m)
• Strong cash generation reduced reported net debt at the year end to £5.5m (2009: £8m), despite acquiring minority interests and investing in working capital to support growth.

Hunt told Recruiter: “We have had a strategy since 2003 of rather than investing in traditional markets, to invest in international markets and emerging markets and developing staffing markets. Two-thirds of our income comes from markets outside the UK.

“Rather than tread the easy paths, looking at Dubai, Singapore and Sydney, we have gone to places like Shanghai, Jakarta, Bangkok and Tokyo. Germany is developing market due to structural change — South America as well. We are spread across better performing economies but also rapidly growing staffing markets.

“The drivers for growth are coming from emerging markets. If you look at what other international staffing groups are saying, in Europe Germany is the stand-out performer. In other parts of the world it’s China in Asia, and to a lesser extent South America.

“There is a challenge for developed economies, particularly in Europe and North America of how they face the structural economic challenges they have got. They have to do that by raising taxes. By doing that they create incentives for talented professionals to look at other places to work.

“The real challenge for the UK is that there is increasing wage inflation in some of these emerging markets and the wage differentiation is closing dramatically for highly qualified professionals. There will be an increasing challenge to keep talented people in the UK.”

His comments come on the day that the Institute for Fiscal Studies warned that the richest 10% of people in the UK will lose 3% of their income from 5 April when new government reforms come into force.