Without doubt, the overall HR recruitment market has been going through an ‘interesting’ 2012 to date.
In general terms, the increased demand for interim hires is currently driving the market while continued economic uncertainty has a sustained impact upon permanent hiring at all levels.
Financial services, for so long one of the key markets for HR professionals, is continuing to experience a somewhat, and not wholly unexpected, lean period with the larger employers focussing on cost reduction rather than growth.
Whilst senior HR professionals in this sector sit tight and await the upturn we are also seeing something of a balancing act as the demand from other sectors sees something of a resurgence.
I’m pleased to report that over the last three months we have had much heightened activity across a broad array of commerce sectors at both mid and senior levels, both in the UK and internationally, and subsequently some much needed key hiring in this area.
Increased activity across commerce and industry
As we move into the second quarter of 2012, the wider ‘commercial’ sector continues, to a degree, to fill the vacuum left by financial services.
We have been handling an increasing number of roles across a diverse array of sectors – although the ‘time to hire’ has conspicuously lengthened with clients taking their time in the interview/selection process and candidates sometimes seeing up to 12 different interviewers before decisions are being made.
Despite the economic situation, many companies who held back in 2011 have reached ‘boiling point’ and feel they can no longer continue with the reduced number of HR professionals following cuts over the last couple of years.
However, this certainly doesn’t mean it’s becoming any easier to land the perfect role as standards are incredibly high and clients will prolong their search in order to find the very best possible match.
The search for top talent is definitely the focus for most commerce organisations and at the more senior end of the market, demand has been greatest in the £80k to £130k range; although there is always some flexibility on package for the best candidates.
We are seeing growth across all of continental Europe but this is especially evident in sectors such as energy (particularly the alternative and sustainability sectors), outsourcing and professional services, gaming, FMCG and some retail. On the flip side, the pharmaceutical, technology and telecoms sectors have seen a slower pace.
Business Partners with keen commercial skills are still one of the greatest areas of demand although we are also seeking specialists in organisational development and recruitment management. In a similar vein to the financial services sector, employee engagement and leadership skills are also in demand.
Fewer senior roles available in the City
The usual spring hiring activity in the City remains relatively low key as many of the larger employers continue to focus on cost reduction rather than growth.
There is some activity from the mid-sized firms – particularly in insurance and asset management – and current key themes continue to be talent, engagement and diversity; how to retain talent, increase the diversity mix in the talent pool and engage staff who have been working hard for a long time with reduced rewards.
We’re finding that there are relatively few very senior City roles coming to the market at present and, when they do, are generally being managed personally at the highest levels in HR. Having come to the market our clients are looking for a high touch, personalised service and an appropriately managed process with high levels of sensitivity.
Controlling the message to the market and appropriate brand management are absolutely key requirements from our clients in their search for significant top talent hiring. Clients are specifically interested in the very best individuals with the right experience gained in the right sectors and therefore the calibre and profile of successful candidates for these opportunities is extremely high.
An interesting dynamic is often the number of HR people covering multiple roles (up to four in some cases) with no budget available to increase headcount.
Any demand that there is continues to be for commercial HR Business Partners, although we are seeing more demand for reward, management information, employee relations specialists and even the occasional recruitment role – hopefully a sign of busier times to come.
Interestingly, there is an underlying demand for talent in the City which is less obvious. Organisations remain on the look out for candidates that are truly top tier and represent ‘picture perfect’ talent as there is a prevalent concern that the levels of capability in many organisations will not be enough for future growth needs.
As a consequence there is an ongoing demand for talent management specialists who can really manage talent processes effectively including impacting at the most senior management levels.
The wider professional services sector is marginally busier as management consultancies ramp up the fee-earning side as they continue to work with organisations on cost cutting programmes.
The prevailing mood, however, is very much one that believes that there will be more activity in financial services during the second half of the year, pre- and post-Olympics.
Increased opportunities for graduates
At the more junior to mid-level end of the market we are seeing activity across all disciplines where HR functions are looking to build their administrative support functions.
In addition to looking externally, companies are increasingly focusing on their own talent management and succession planning to retain top talent and, where possible, promote internally in order to offer development.
Encouragingly, there has been an increase in opportunities for graduates seeking their first HR role and this, in turn, has meant that salaries at the junior end of the market have increased, with candidate’s expectations also significantly higher than in previous years.
Furthermore, some of the smaller brands are starting to be more generous in terms of their remuneration in order to help them compete for the best candidates and attract talent from larger organisations.
Organisations are also increasing their use of social media to focus on developing their employer brand and attract the more passive job seekers.
All of this has meant that, increasingly, more companies are attempting to direct source for roles before making the decision to work with a supplier. As a result, we have seen an increased demand for in-house recruiters as companies are moving more towards a focus on direct sourcing methods.
Candidates with strong in-house recruitment skills are thus in a good position to demand higher salaries.
Business transformation interims in demand
At the top end of the interim market, the demand is very much for business transformation along with senior talent and reward expertise. Organisations are looking to senior interims to bring new skills into existing HR teams and to run large scale, bespoke transformation and development projects.
However, the increasing number of senior HR professionals available for interim work continues to keep day rates keen and organisations are often looking to add value and maximise effectiveness through more efficient use of interim professionals.
We are seeing a significant trend in extending or adding new projects and, therefore, drawing out the length of the original interim assignment.
With regard to the more mid-level interim market, we are certainly seeing an increase in demand for generalist as well as HR management and business partner roles. There would appear to be a shortage of top tier candidates at the £60k level and clients are conscious of this and retaining good interims on a longer term basis.
Similar to the permanent market, at the more junior interim level we are seeing a high demand for HR systems, reward and compensation and benefits analysts alongside the growth in interim administration roles. Clients want a lot more for their money these days but interestingly the junior end of the market remains very candidate driven.
Finally, of note is the fact that unlike the permanent recruitment sector, we are seeing good activity levels in the interim financial services and public sector markets.
While we are certainly not heralding a full scale return of business confidence and economic growth, it would be nice to think that if it isn’t necessarily ‘the beginning of the end, it might well be the end of the beginning.’
Alistair Cook is chief executive of specialist HR recruitment consultancy, Digby Morgan.
This article was first published by our partner, Changeboard.
