The recruitment industry really likes January – it’s when it all picks up again. Recruitment activity slows dramatically as we head into December and some recent research offers a possible explanation.  We are working longer hours with no increase in rewards and the approaching Christmas party season offers a chance to take the foot off the gas.

But in January, it’s all change.  The sense of urgency that was lost before Christmas all of a sudden returns.  If you believe there is a link between our New Year’s priorities and what’s being advertised in the media, then, once we have bought a new sofa in the sale on interest free credit, we turn next to job hunting.  Combine this with companies setting their new budgets for the year and starting to recruit again and that’s why the recruitment industry likes January.

So far, this month is running true to form.  For us, new job registrations are at the sort of levels we would expect at this time of year and the CVs are coming in.  Optimism for a good year is running high but are there dark clouds appearing on the horizon?

Whilst the ‘business as usual’ sign is firmly nailed across our front door, questions are being asked as to how recruitment might be affected by some of the cracks that are starting to appear in the wider economy.

For sometime now there has been a demand for staff numbers in the industry that has outstripped supply.  Companies have been crying out for staff and there haven’t been enough qualified candidates to offer them.  This can partly be attributed to the fact that the good times have been rolling - salaries, bonuses and opportunities have been good.  There have been less reasons to resign and move employer.  If that situation does change, some redundancies are inevitable and pay rises may shudder to a halt which means looking for a new job.  However, staff may still not be encouraged to make the move and may prefer to hunker down and ride the storm. 

In our experience, great career opportunities are out there in all market conditions and 2008 will be no different from any other year.  My advice is not to be nervous of any market conditions that may or may not prevail.  However, it is vital that you are accompanied on your job search by the right recruitment partner and there are a number of things to look for when choosing who to work with.  This is even more important if the market becomes tighter.

It is important to find someone you can work with and trust.  Your relationship with your recruiter should give you an idea of his/her relationship with the clients they deal with.  You are better off sticking with recruiters who have been around for sometime – they are likely to have a deeper knowledge of their clients and be able to give a better opinion as to whether a company is a safe bet to join or not.  If there is any sort of downturn, all the established recruiters will have seen it all at least a couple of times before so will be able to advise you on the best way forward.  It’s also a good idea to chose somebody to work with who has a good spread of clients.  With the IFA market mainly being made up of SMEs and a huge number of firms with sub 15 employees, good opportunities really do need rooting out.  And there can be some fantastic opportunities within these small but well run and well funded businesses.  Their client list may not be huge but they are often highly loyal and valuable and, perhaps more importantly, unaffected by sub-prime, the credit crunch or any possible downturn in the housing market.  Finally be open with your recruiter and you will find that you will get the best out of them.  Listen to their advice because this will be advice based on years of experience recruiting in all market conditions. 

It’s a bit early to be making any serious predictions about 2008.  I am sure, however, that it will be a very interesting year and, providing that I am invited to give my opinion later in the year, I look forward to giving you an update.  I hope to be reporting that the levels of recruitment are similar to last year but only time will tell.      

The recruitment market in Financial Services has been suffering from a shortage of good quality candidates in the last few years which has caused real problems.  The good news is that there are some signs that this is beginning to change.  I believe that the specialist recruitment consultancies have played a major part in causing this change.

In recent years, there has clearly been a demand for certain skills that the market has been unable to supply in enough quantity. Paraplanners, IFAs, Sales Support, candidates with the right qualifications or specialist IT knowledge - the list goes on and on.  The result is that jobs have stayed vacant for longer and salaries have gone up as a result of intense competition for candidates with the desired skills. 

Recruitment consultants have been informing their clients of the shortage and, indeed, clients are fully aware of the situation as there have been few CVs coming through.  In the face of a candidate shortage, they have encouraged their clients to be flexible and widen the net.  In the main, clients have stuck to their initial criteria but now, however, we are seeing a lot more flexibility and a shift in attitudes.  Recruitment consultants can justifiably take the a big chunk of the credit for this.

By encouraging a client to be flexible it doesn’t mean that we are asking them to drop their standards.  What it means is focussing on fundamental talent rather than specific skills.  It’s a case of buying in the skills that you cannot train for and training on the skills that you can.

To illustrate this by way of an example, we had two clients this week with pretty much identical jobs.  We sent the same candidate’s CV to both of them.  One loved the CV, interviewed him straight away and made him an offer.  The other one ‘phoned up and tore us off a strip for not sticking to the criteria.  One company has filled their role and can move on with training and meeting their business objectives.  The other is still spending time recruiting, getting frustrated and not meeting business objectives.

The candidate shortage has naturally affected candidates and clients in different ways.  For the candidates who do have the right skills and background it has been bonus time.  Salaries have gone up and they are receiving plenty of attention and offers.  Candidates without ‘in demand’ skills and experience have found it longer to find the right role.  There is, however, a potential downside to all this.  Employers that are paying top dollar salary are going to expect a lot of return.  Also, in the scramble for candidates with relevant skills, the basics can be overlooked – such as can the candidate actually do the job.  Expectations are often not met which causes problems on both sides. 

As the clients widen their criteria, the balance of competition could also change.  There will be more competition for the jobs this time rather than the other way round.  This is great if you have been finding it difficult getting in front of the plum jobs, not so great if you have been relying solely on having an ‘in demand’ background.  Two, of what I would consider to be, top of class jobs that we filled this week were filled by individuals with no UK experience at all.  And both clients interviewed a lot of people with relevant experience.

My advice to all candidates is to continually review your qualifications and technical knowledge.  This is vital in order to get that prime job, whether of not it is a perfect match to your current skills set.  Don’t become over paid and under qualified and don’t start making demands on your future employer until you have proved yourself.  And if you have been used to being in demand, keep an eye of for the competition because that could all change. 

It natural that an evolving industry, such as UK Financial Services, will have different staffing demands at each stage of its evolution.  Client requirements will change and as an employer, or a job hunter, it is important that you have the right recruitment firm representing you.  One who is open to change, willing to listen and is up to date with market trends.

As the nation’s media comment on how much better, or worse, off we are after 10 years with Tony Blair at the helm, I’ve been thinking how my own little world has changed.  When I first started recruiting for the Financial Services industry the market was dominated by the product providers’ big sales forces.  As a recruiter you would work for a few of these companies on a fixed fee.  Your candidates did not need any experience – just a list of friends and family to sell to.  The jobs were 100% commission and, provided they sold a few policies, the financial risk to the company was not great and consequently, the actual recruitment process and decision was not a difficult one. A small advert in a national paper promising riches was enough to keep the whole process moving along nicely.

Today the industry is a completely different place – a much better place with client care, fees and regulation.  It has changed.  However, a consequence of becoming a better place is that, for many, the previously easy recruitment process has become much more difficult.

I’ll illustrate this by way of an example.  We are carrying out some advertising for an IFA client.  They are a small firm who are succession planning.  Whoever takes this job will join a quality operation on a very high salary and will have a very bright and financially rewarding future.  They will benefit from joining a company has been through all the changes that the industry has seen over the last several years; has endured the pain of this change and has emerged as an example of what makes a great modern IFA firm.  Undeniably this is a plum job.  If we had advertised a job like this in the old days of commission only we’d have been fighting them off with something the size of the FSA rulebook.  What happens today?  Little response. 

There are many possible reasons for this.  OK, succession planning is always a tricky one because there are a whole host of soft skills you are looking for as well.  It’s a bit like finding a wife, or husband.  But our client is willing to pay top dollar so it can’t be that.  We could put it down to the industry problem of candidate shortage which must have an affect.  Less people joining the industry and training as IFAs will mean a dwindling talent pool when recruiting for the big jobs.  It could also be down to the simple fact that the good people are happy where they are.  Most of the IFA firms we deal with now are very well run, well-structured, well-funded and successful businesses with no shortage of good quality and wealthy clients with complex demands.  As a consequence they are able to retain and develop their good staff which means they have become more difficult to tempt away.

To counter this problem I think that IFA firms need to be constantly hiring for apprentice type roles so that they create their own talent pools.  These apprentices can learn the business from the bottom up and can be groomed for key roles.  The common counter-argument to this is that these rookies will leave once you have gone to all the expense and time of training them.  This is really no argument - create the right environment, development and career opportunities and they won’t want to leave.  We no longer have large direct sales forces that train up staff anymore so they have to be home-grown.

The other alternative is to look elsewhere – hire from other industries or look closer to home at building societies and other finance operations, for example, where candidates can be cross trained.

The great thing about the IFA industry now is it offer fantastic careers – it’s surely more exciting being an IFA than an accountant or a lawyer – and it can pay more.  The industry is in a position to be able to attract quality trainees into it so it should take advantage of this and go out and get them.  It should also be able to attract those candidates who wished to work in investment banking or stockbroking.  The industry didn’t find it difficult to attract candidates to work on a commission only basis all those years ago so it shouldn’t find it difficult to attract candidates now that it can offer great careers.