ManpowerGroup MAN Business Risk Report

A. Fluctuations in global economic conditions: ManpowerGroup’s operations are highly sensitive to global economic conditions. Economic downturns or instability, particularly in key markets such as the United States and Europe, can affect demand for workforce solutions and services, impacting the company’s financial performance.

B. Changes in labor market dynamics: Shifts in labor market dynamics, such as changes in employment rates or the emergence of alternative forms of employment like gig economy roles, can influence ManpowerGroup’s business model. An increase in unemployment, for example, might increase the pool of candidates but reduce demand from businesses.

A. Dependence on key personnel: ManpowerGroup relies heavily on the expertise and experience of its key executives and skilled professionals. Loss of such personnel, without adequate succession plans, could disrupt operations and affect growth strategy execution.

B. Cybersecurity threats and data breaches: As a global provider of workforce solutions, ManpowerGroup manages a significant amount of sensitive data. The company faces risks related to cybersecurity threats and data breaches, which could lead to significant financial losses and damage to its reputation.

A. Foreign exchange rate fluctuations: ManpowerGroup operates in numerous countries around the world, making it susceptible to foreign exchange rate fluctuations. These fluctuations can impact financial results, especially when consolidating revenues from non-U.S. operations to U.S. dollars.

B. Credit and liquidity risks: ManpowerGroup is exposed to risks associated with the creditworthiness of its clients and liquidity requirements. A downturn in a client’s financial situation could adversely affect the company’s financial position.

A. Compliance with labor laws and regulations: Compliance with diverse and frequently changing labor laws and employment regulations across various jurisdictions poses a significant challenge for ManpowerGroup. Non-compliance can lead to legal repercussions and financial penalties.

B. Changes in immigration policies: ManpowerGroup’s ability to source talent and provide staffing solutions can be impacted by changes in immigration policies, particularly in countries with strict work visa regulations. Such changes might restrict the company’s ability to meet client needs in specific regions.

A. Intense competition in the staffing industry: The global staffing industry is highly competitive, with numerous firms operating at various scales. ManpowerGroup faces intense competition, which can pressure pricing, market share, and profit margins.

B. Failure to adapt to technological advancements: Rapid technological changes present a risk for ManpowerGroup, especially if it fails to adapt or innovate accordingly. Lagging in the adoption of new technologies can lead to operational inefficiencies and loss of competitive advantage.

A. Diversification of services and global presence: ManpowerGroup mitigates market and operational risks by diversifying its service offerings and maintaining a robust global presence. This approach helps balance exposure to economic fluctuations across different regions and sectors.

B. Robust cybersecurity measures and regular audits: To combat the risk of data breaches and cybersecurity threats, ManpowerGroup implements stringent cybersecurity protocols and conducts regular security audits and upgrades.

C. Hedging strategies for managing financial risks: ManpowerGroup uses various financial instruments, including forward contracts and options, to hedge against foreign currency risks, thereby stabilizing cash flows and profit margins.

D. Constant monitoring of regulatory changes and proactive compliance initiatives: The company actively monitors legislative and regulatory environments in all jurisdictions where it operates, adapting its policies and practices to ensure compliance and avoid legal penalties.

E. Investment in research and development for technological innovation: ManpowerGroup invests in research and development activities to keep pace with technological advancements, ensuring ongoing innovation and enhancement of its services and operational efficiency.