* Pagegroup issues second profit warning this year
* Robert Walters' UK profit slides 11%
* Trade war and Brexit keep companies on edge
* Hong Kong protests and slowing German economy also weigh
* Shares fall across recruitment sector
By Uday Sampath Kumar and Yadarisa Shabong
Oct 8 (Reuters) - Britain's PageGroup and Robert Walters warned on Tuesday that profit will be hit by a global recruitment squeeze as continuing geopolitical issues such as Brexit and the U.S.-China trade conflict dent economies.
Shares in Robert Walters, which has a presence in more than 30 countries, fell by 10.4% while larger PageGroup plunged nearly 13% to its lowest in nearly three years.
The deepening crisis over when, how or if Britain leaves the European Union has hit every sector of the UK economy, with many businesses calling a halt to hiring until they have a clearer picture of what a divorce deal will look like.
Demand for new staff at British companies in September increased at the weakest rate in almost eight years, a survey showed on Tuesday.
Companies presented with a negative backdrop will think hard about their spending, and that includes staff costs, said AJ bell investment director Russ Mould.
“The first step in a bleak situation is normally to hold off replacing staff who have moved on to another job. The second step is to make actual job cuts, and it feels like we may be seeing the first small signs of that, given talk of HSBC slashing 10,000 positions," Mould said.
Robert Walters said its gross profit in the UK fell 11% in the third quarter, while PageGroup's second profit warning of the year followed a 4.1% drop in quarterly earnings in its home market.
The news pushed shares of other recruitment companies lower, with Hays, Sthree and Swiss-listed Adecco Group all down in early trade.
Fears of a global recession has been a particularly dark cloud hanging over the recruitment industry as the protracted U.S.-China trade war and a weakening German economy keep companies on edge.
The flagging Chinese economy is also having a ripple affect on hiring in countries such as Australia as its export-focused commodities sector goes through a slowdown, Robert Walters finance chief Alan Bannatyne told Reuters.
PageGroup and Robert Walters said business in Hong Kong is also being hurt by the continuing violent protests by pro-democracy activists.
"Looking ahead, the deterioration in trading conditions seen during Q3 across the majority of our regions is anticipated to continue," PageGroup said.
The company forecast 2019 operating profit in a range of between 140 million pounds ($172.2 million) and 150 million pounds, down from previous guidance of 156.5 million to 168 million pounds.
Robert Walters said it expects annual profit in line with the last year and that it has cut its global headcount by 2% to 4,258.
Bannatyne did say he expects business in the UK to bounce back when Brexit developments give companies and candidates some clarity about the future.
Prime Minister Boris Johnson has promised to take Britain out of the European Union by Oct. 31 come what may, despite parliament passing a law ordering him to seek a delay if he cannot secure a new transition deal. ($1 = 0.8132 pounds) (Reporting by Uday Sampath and Yadarisa Shabong in Bengaluru Editing by David Goodman)