The Coronavirus hasn’t been the most positive impact on the recruitment market I’ve known. As an overall sector, the market has contracted somewhere between 23% and 70% since the March 23rd lockdown announcement, depending on which source you listen to. All of which are probably largely subjective.
Baring in mind as the shutters came down on the recruitment market,.. economy,.. country,.. world,.. the UK was at record high employment (76.6%, up 0.4% on the previous month), and there were 817,000 job vacancies. The jobs market could scarcely have been in a better place, so any hiccup was going to see a contraction regardless. Plus, the weeks since 23rd March would have contracted anyway due to the Easter break. (for reference, the recruitment market in April 2019 was 26% down on March 2019, again largely due to the Easter break)
But it is still, well,….(I want to say crap, but that’s not professional), so lets say ‘challenging’. It is still challenging.
Executive Search has been less affected than volume contingent recruitment. Tales from friends in the contingent bulk end of the recruitment marketplace make for sour reading. Workforces furloughed, live recruitment processes mostly cancelled, offices closed physically and virtually. All whilst still coping with a hefty fixed cost base.
Conversely, all our mandates are still live, offer processes have gone on unaffected and with just one international appointment as an exception, start dates adhered to (and that appointment delayed by just one month for logistical reasons).
Furthermore, whilst our new instructions from 23rd March to 10th May are running at 70% of the same 7 week period in 2019, we have commenced new roles including a £150k Chief Operating Officer, a £100k Head of Digital Marketing and a £70k Commercial Relationship Leader.
We have also had twice as many early instruction conversations than we had in the whole of Q2 last year, largely helped by the ‘Wartime Consigliere’ boardroom cull planned by investors as reported last week, here: Boardroom clear-outs. A new epidemic? Investors become Dons.
There are some interesting stats that have come out of the Covid-19 ‘situation’ so far.
10 years ago, HS2, the cornerstone of the Northern Powerhouse, promised the redistribution of business & talent from London to the North. It would take 25yrs, maybe more. But the magnetic draw to the top executives to the South-East would be lessened.
10 years on, and in the 5 weeks since the lockdown announcement to the end of April we saw a 400% increase in London-based execs speculatively applying for Northern-based roles.
Living in such a densely populated area was a large factor, but the most commonly given reason given by execs was quality of life, and in particular, the quality of home life.
Whilst the executives in the north coped with lockdown in houses with at least twice the room count compared to humans, and garden or three, often a fairly large garden or three, and a semi-rural Cheshire setting, with countryside view, and double garage and/or out-buildings converted into a gym/fitness suite; their inner-M25 counterparts were often sat in £7-figure houses, in densely populated locations, minimal outdoor space, minimal indoor space, no garage indoor gym, etc.
The first two conversations that arouse were from execs on significant £6-figure salaries, both with families. One lived near Richmond in a ‘townhouse’, with no off-street parking, let alone a garage, and a rear garden that if all three of his children were in it, the cat couldn’t be swung freely. Lockdown was a challenge.
The other, an original Northerner that lived in an apartment overlooking Battersea Park that he had bought 4 years ago for twice what he’d sold his 5 bedroom detached house near Knutsford for. No garden. No parking. Not even a balcony. And his only route outside was via numerous communal areas/keypads/access buttons. Lockdown was more like imprisonment.
These were the first of many that cited the bright garden lights of the North-West as being a huge attraction.
If the 25 year HS2 project was all about redistributing business talent and wealth to the North, Covid-19 achieved the same objective in less than 25 days.
Greener than Green
The environmental impact on the Coronavirus has been well reported. One look over any major city, or any satellite images over a major city, and the dramatic drop in pollution is incredible….indeed, anyone that has sat outside without sun-cream on for an hour or two will notice how much quicker they burn(!).
NO2 density levels are roughly 30% down, or around 30 years. Some cities have seen more than a 50% drop. Covid-19 has done more to help the environment in two months, than environmental campaigners have achieved in two decades.
We’ve also seen animals regaining town streets, from Sea Lions in Buenos Aires, to Goats in Llandudno.
But even within recruitment, we’ve seen a marked shift in key desirables for executive job seekers.
I touched on the subject two months ago with the (now seemingly prophetic) blog, No office is the new ‘corner office’. Highlighting the growing trend for flexible working patterns and the need for businesses to offer fully integrated technological solutions to allow it.
3 weeks after that blog, we just about all started working from home; some afforded more fully integrated technological solutions than others. But the benefit that has brought to family dynamics has shifted executives’ views on flexibility – more and more citing the desire to have the ability to work from home for at least part of the time.
The driver for that is partly familial, but equally common is the efficiency execs have discovered exists without the real-world interruptions having your team on the other side of an office door brings.
Our first interview with headhunted execs is extremely conversational, but does cover motivations that would increase the interest in a career move. That efficiency of working, new found objectivity in a day’s productivity has become a frequent panacea for team and business leaders.
Likewise the travel policies of international roles. The top three ‘must haves’ for more international execs used to typically be centred around class of travel/class of hotel/time considerations for long-haul/etc….. It is now the absolute need for the travel in the first place.
A global Pharmaceutical Sales Director interviewed last Friday typified that trend. I conducted my first interview with her in March. At that time she was totally comfortable with anything under 50% international travel. But her view changed quickly. She had had her travel completely stopped in the same week we met in March due to the impending pandemic; and yet her performance, her sales, her profitability and her customer contact has been wholly unaffected. The same thing for her team.
It left her with a ‘road to Damascus’ like conversion that FaceTime was a perfectly good substitute for face time. Her travel wouldn’t be 0%, but she now knows the 150+ days she spent travelling, seeing all other aspects of her professional life disrupted as well as being away from home, away from her family, having the need to be within 15mins of a major international airport,…would be dramatically eased. As would the newly-realised potential threat to health of spending 100s of hours a year in a crowded airport, exec lounge or otherwise.
What’s more, the CEO that interviewed her sat wide-eyed at the prospect of having a Sales Director that would be on the ground for most of the 52 weeks per year he needed her, to say nothing of the cost and upheaval to the team left behind.
Those drivers may be personal, familial or financial….but the positive impact on the environment if it becomes common place is significant. Unless your surname is Branson, Walsh or Al Maktoum.
Even at a national level, the dramatic reduction in physical meetings, and time moved away from the UK’s road and rail networks and on to the increasing choice of virtual platforms as the same impact on time/cost/efficiency/environment as the perceptively more glamourous world of international travel.
So what of the short-term future for Exec Search?
Like I admitted in March’s blog The one with Recruitment and a Coronavirus, I’ve no real idea. I don’t think anyone really has. The signs then were optimistic. Roles created due to the Coronavirus (directly or due to executive time permitting greater strategic planning).
Those signs are equally relevant and present today. The recession that is inevitable after this crisis will be the fourth I’ve recruited in (and through….hopefully!). Exec Search is a great barometer of business activity and confidence, but the wider recruitment sector can be one of the last to emerge out of economic slowdowns. BUT….. my last three recessions were dogged with a lack of appetite to recruit. This time it is different.
The conversations we’ve had for the last 7 weeks have had a common theme, businesses WANT to recruit but just can’t at the moment. Back to where we started, the exec job market was buoyant. Quality candidate scarcity, all-time low unemployment/high-employment and tempered optimism from an economy that had solid foundations.
Add into that the already-in-discussion boardroom shake-ups as discussed in last week’s blog Boardroom clear-outs. A new epidemic?, the signs are good.
For the north at least…..