Released On 17th Nov 2020
Recovery or Recession for the Recruitment Industry?
Approximately 4 weeks ago, this article would have been based on the former. Recovery. It would have been full of positive statistics and quotes about bringing our industry back from the brink. But we’re rapidly moving into a less confident footing, and now? I’m not so sure.
Not unexpectedly, when the pandemic hit us full force back in March, the recruitment industry was shaken to the core. Recruitment sits on the growth end of the business journey. When times are certain, cashflow is good, customers and profits are rising – call in the recruitment cavalry. But the flipside of that – uncertainty, volatility and poor cashflow – generally doesn’t lend itself well to hiring spikes and boosting headcount.
Of course there were (and are) a selection of businesses able to continue growing throughout COVID – predominantly those businesses deemed essential or frontline – but even within those frontline sectors, since March the bitter pill of total lockdown has loomed large, threatening long term recovery and drawing out the most cautious side in many of us. Spring and early Summer in the recruitment industry was sleepy to say the least.
Back on the Agenda
Then in late summer we started to experience rays of hope. Children began to return to school, Boris encouraged workers to go back to their (socially distanced) offices and we could eat a meal somewhere that wasn’t our own kitchen table. Businesses tentatively came out of hibernation, blinking in the sunlight but full of hope and ready to bounce back. Recruitment was back on the agenda.
It was perfect timing too. With the furlough scheme being wrapped up, and redundancies sadly at an uncomfortably high level, it was an intense time of transactions between clients and prospective candidates. For the first time in years we were experiencing a very heavily client driven market, balanced with a multitude of available talented candidates. The perfect blend for recruitment magic.
And despite the doom and gloom touted by the national press about the thousands of applicants for every minimum wage job, for the skilled, experienced and specialist roles there was a degree of synchronicity in certainly supply – and in many cases demand. Recruitment was officially back in business.
As September progressed, whispers of a second lockdown began to emerge. Boris backtracked on his encouragement to get workers back in offices, our social circles were reduced to the rule of six, and perhaps the saddest metric of all – the death toll began its second steady climb. Clients and candidates began to slowly retreat in preparation for the next storm that seemed to be coming our way. Scarred by the toll the last six months had already taken on our lives, jobs, and businesses those early green shoots had to take a pause to consider what is next.
Fast forward to today, and whilst there is still movement in the marketplace, it is slowing. The latest news from the REC (Recruitment & Employment Confederation) suggests that recovery in our industry is decelerating, as job advert postings fall for the first time since July, with new job advert postings falling by 7.6% in the space of a week. Neil Carberry, Chief Executive of the REC, said:
“With Covid cases rising and further restrictions being imposed, a pause in the strong trend of recovery we have seen over the summer is perhaps not a surprise, though it’s deeply unwelcome.”
(article source - https://www.rec.uk.com/our-view/news/press-releases/jobs-recovery-tracker-recovery-slows-virus-returns-adverts-fall-first-time-july)
In addition to which, the candidate supply has also slowed down. Those in a secure job in a business that has already weathered the first COVID storm are reluctant to see whether the grass could be greener on the other side.
Whilst this is all, as everything is, temporary – it is a time of change and huge upheaval – and potentially Darwinian.
Any member of any professional networking site (such as LinkedIn) will have seen the well-documented, and incredibly sad, redundancies of recruitment professionals – both agency and in-house – so to weather this second storm we’ll need to be brave, evolve, adapt and be ready for what comes next to avoid extinction.