There have been encouraging signs of more HR hiring activity during the last couple of months following our golden summer of sport.
HR stakeholders are now back in the office and permanent recruitment is starting to move again, with the flow of new opportunities also on the rise.
Financial and professional services
As expected and widely reported, the financial and professional services sector experienced a very quiet July and August, with many employers and job candidates taking the opportunity to use their mandatory compliance leave during this period.
The second week or so of September saw an upturn across both sectors, however (with a sense in the City that there is now a pre-compensation window of about six-to-eight weeks to undertake hiring activity).
There was a good level of demand for HR generalists, reward, talent and learning professionals, mostly at the £60,000-80,000 salary range, although there were some signs of increased interest in candidates at the £110,000-130,000 level too.
Most of this demand is coming from clients in the insurance, asset management and professional services sectors.
For candidates expecting to earn £150,000 or more, the market continues to remain slow, with many of the limited number of vacancies there being filled internally or directly through network connections.
Consequently, the pool of available candidates at the top level is of a pretty high calibre and, although some are becoming more flexible in their financial expectations in order to land the right job, many of the best candidates have no burning desire to move without securing a significant salary increase.
But this situation has in some instances been creating problems for employers as organisations that are facing cost constraints and are unable to meet salary expectations are being cautious about finalising their decisions to hire externally and, consequently, often miss the boat.
The continuing economic depression is also piling the pressure on in-house teams and recruitment process outsourcers to focus on sourcing candidates directly, which is challenging in a weak talent market.
As a result, there is a sense that companies are running increasingly skeletal HR functions as cost constraints mean that even maternity leave is not being covered externally but being handled internally instead.
Many senior HR clients are desperate to bring in fresh talent but unable to do so because of low attrition rates and restrictions on headcount. When they do get approval to hire, they are very focused on bringing in talented ‘high potentials’ to their organisations.
These ‘high potentials’ are candidates with strong stakeholder management skills and a proven track record of delivering change, who can also grow into their roles rather than being overqualified from the outset.
Commerce and industry
There are continuing signs of optimism across the wider commerce and industry sectors in the UK, although, as one would expect, business in mainland Europe appears to be stagnating – except in Germany where demand remains strong.
Much of this demand is coming from the technology, ecommerce, creative and outsourcing markets, although the services and energy industries are also fairly buoyant. More and more activity is also taking place in the small-to-medium enterprise space rather than simply among larger corporates.
Interest also remains particularly high in reward, organisational development, employee relations, change management and talent acquisition specialists, especially in the £65,000-75,000 salary range and again at the top end at around £130,000-150,000 – although interestingly, earlier this year it was in the middle £70,000-90,000 bracket.
When it comes to generalists, however, there is a lack of blue chip talent at the £45,000-55,000 salary range.
But we are reticent to declare that any overall upswing in the market is taking place. Activity is quite ‘random’ and sporadic and, more often than not, driven by a requirement for tactical appointments and replacements rather than a strategic decision to invest in the HR function.
Moreover, even when hiring decisions are approved, the actual process itself is frequently protracted, especially in larger organisations where there is often an endless search for the perfect candidate.
This situation is made all the more difficult by the on-going dearth of talent available. A lot of possible candidates are choosing to stay put and are not actively looking for new roles, their perception being that, with fewer opportunities around, they are better off simply focusing on developing their current role.
By the same token, a growing number of organisations are also focusing more on retaining and developing their top talent so as not to lose them to the opposition.
Salaries at the junior end of the market are rising by up to 20%, however. Employers are prepared to pay more for junior talent with limited experience if they can train and develop them internally.
Public sector
The outlook for the public sector over the next quarter and beyond is likely to remain challenging. That doesn’t mean activity is non-existent as has been the case for the last two years at least, but expenditure, and therefore recruitment, remains under very close scrutiny.
Where organisations are recruiting, it is very much for business-critical roles that have now been formally signed off following comprehensive business case reviews. Even then, the recruitment process is very detailed and often elongated as the role is constantly reassessed against changing requirements.
There has been a modest increase in demand for more junior to mid-level positions, however, and, although we are certainly not inundated with senior public sector HR posts, the function remains at the forefront of the change taking place.
As organisations continue to focus on cutting costs and making efficiency savings, strong commercially-minded HR candidates remain in high demand.
Dona-Mirelle Battat is an executive director of specialist HR recruitment consultancy, Digby Morgan.
