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Accountancy & Finance
Market overview 2008
Despite the hovering spectre of the 'credit crunch' and its marginal effect on some employers, recruitment across the accountancy and finance sector remains buoyant with no signs of a projected slow-down.
Burgeoning temp/interim market
As the fall out from the 'credit crisis' begins to unravel, potential headcount freezes could impact on levels of permanent recruitment as employers turn to the interim/temp market to meet their skills.
Companies have remained focused on attracting the best talent while the number of jobs will continue to outstrip the candidate volume. The retention of qualified talent has noticeably intensified within the 'Big 4' accountancy firms.
Total rewards - empowering the employee
Salary remains the main enticement for candidates and despite the obvious lure of remuneration linked to performance (improved bonuses), candidates continue to place great store in their career progression and development.
Typical benefits include stock options (especially for senior level appointments), life assurance, family-friendly policies, healthcare and a company pension scheme (final salary schemes being phased out). Some employers include a car allowance as part of the salary provision.
Employers are increasingly moving towards a total rewards package based on a benefits model. This gives employees a greater say in determining their preferred trade-off between salary, core and more flexible benefits. Examples include buying holiday time.
Skills shortages in candidate-led market
Permanent qualified and part-qualified candidates are the most in-demand candidate groups across the UK but there are very apparent skills shortages in a candidate-short market.
Salary and monetary benefits remain the dominant motivators but organisations have generally improved their 'employee value propositions' as part of their talent management programmes.
While employers do need candidates that can bring the right skills set to their vacancies, they need to be creative if they want to attract the best. Non-monetary benefits and work-life balance are paramount and this is where some SMEs can steal a march over their larger counterparts.
The outlook for the UK economy throughout 2008 remains upbeat with strong growth predicted - the spotlight will be on London and the banking sector in particular, which despite the sub-prime problems, still retains a comparative advantage over other cities and industries.
Hays Human Resources Salary & Benefits Guide 2008
Market Overview 2008
The Hays Human Resources Salary Survey 2008 has revealed some encouraging results for HR professionals in the UK.
HR professionals continue to play an active part across the public and private arena, and on the whole, salaries have continued to rise. Some sectors have seen only steady, inflationary increases but where this is the case, roles have been broadened and a range of non-contributory benefits have been added to improve the overall attractiveness of the reward package.
Some companies have communicated more cautious growth plans than in recent years, however demand for experienced HR candidates is still out-stripping supply, especially in the interim sector. Specialist recruitment consultants are increasingly in demand to source these candidates and there is evidence to show more organisations have or are considering outsourcing their recruitment function.
There has been talk of economic downturn with certain sectors feeling the effects of the ‘credit crunch’ in the UK and globally. There has been a downturn in the City with fewer roles in the banking/financial sectors that are traditionally well-paid. The property sector is feeling the effects of slower house sales and fewer new –build projects and many retail companies are reviewing their HQ headcount.
However, it is often at these difficult times that HR professionals add most value to their organisations.
Heidi Waddington, MD Hays Human Resources comments: “At a time of uncertainty, HR professionals often come to the fore. The focus is on improved retention and enhanced productivity and this can be achieved through effective training and development initiatives. Where redundancies are unavoidable, the HR community can manage this process with minimum risk, ensuring best practice and the best possible outcome for all parties.”
Also, in some sectors, HR is being embraced as never before. James Collinge is Head of HR at law firm Field Fisher Waterhouse. He comments: “Legal has perhaps historically lagged behind other sectors in terms of its HR initiatives, but for many modern, forward-thinking firms, this is now being urgently addressed with full board-level support. Working within a law firm offers a great deal of challenge for the modern HR professional and, as our market place becomes more global, so do the career options as well.”
Significant growth – 5% - in roles at Officer and Advisor level has been reported and there is a shortage of candidates at this level. Some specialist roles are also proving challenge to recruit for, specifically reward and strategic resourcing. At all levels, the CIPD qualification is demanding a salary premium.
As always, we have witnessed some regional variations to the national trends. One example would be the noticeable quietening of the jobs’ market in South Yorkshire, compared to Sussex where candidates are in great demand, especially those moving within their sectors.
At the senior end of the market salaries have remained fairly consistent over the past year. There are fewer opportunities with senior candidates seeming more risk-averse in this uncertain market. As at the more junior level, there are good opportunities for flexible, career interims.
Retention
Our research shows that higher salaries are often not the main factor when considering a new role.
Career progression, personal and professional development, working for a respected organisation that can offer long-term prospects are most commonly cited as reasons for seeking a new role. Candidates say they need to believe they can add value and influence change.
It is interesting that many companies seem to be spending more time on improving their benefits packages and our research indicates that the benefits that influence candidates most are bonuses, healthcare provision and holiday entitlement.
Furthermore, more and more candidates are looking for part-time and flexible working at a time when fewer organisations are prepared to offer this.
Specialist skills in demand
As identified earlier, experienced junior candidates – with salaries £18,000 to £20,000 – are in short supply and employers are struggling to retain candidates at this level.
There appears to be a shortage of experience around TUPE, redundancy and re-structuring and these are the skills most needed for contract work, often in public services linked to the Agenda for Change.
Reward candidates – especially those at middle and senior management level – are always in demand and can achieve salary premiums.
Public Services
This is a positive time for employment in the Public Services arena. Working within nationally agreed pay bands, with fewer regional variations, packages do not appear to fluctuate in response to external, economic pressures. However, salaries are still lower than in the private sector.
Our research indicates:
- an increase in the volume of permanent recruitment
- an overall rise in salaries in line with annual salary reviews, an average of 4% compared to 2.4% in the private sector
- higher increases for ‘hard to fill’ roles eg. 5% increases for Learning, Development and Talent Management roles
Retention within Public Services is best achieved with the following initiatives:
- flexible working options
- part-time/job sharing
- better pension provision
- generous annual leave
Heidi Waddington comments:
“Flexible working opportunities and clear career paths are generally more attractive to prospective employees than a higher salary. Candidates are keen to find out about the total package, prior to attending an interview.”
Learning & Development
In recent years, government targets to upskill the workforce and funding of NVQs and basic skills training have improved Learning and Development within the public sector to bring it more in line with its private sector counterparts. In addition, the drive to improve leadership and governance has led to funding from the IDeA and the Office of the deputy prime minister that was not available years ago.
The National Pay & Workforce strategies have identified good and bad organisations in relation to their L&D spend, and other factors such as Comprehensive Performance Assessments and Inspections have linked performance with the development of people. This has led to L&D activities being given a higher priority by organisations. The Investor in People award has also influenced expenditure.
Sally McAuley, Learning & Development Manager at East Devon District Council, comments:
“The L&D Manager must now be more focused on the impact of training on service delivery. We have to show that performance has improved and that this impacted on the organisation. I think that this has led to some 'classroom trainers' being replaced with more business-conscious, higher level L&D professionals with a greater remit than just stand up delivery which has in turn has increased salaries. I believe L&D posts are now advertised at salaries more comparable with HR professionals than they were 10 years ago. A recognition that people are motivated by factors other than pay has also made L&D opportunities a critical factor in the 'Employer of Choice' debate. I think this has led managers to better protect their training budgets than they did ten years ago. In the past year I have not seen or felt a squeeze in L&D - in fact my budgets have increased.”
Senior Appointments
At the senior end of the HR market place, it is still possible to command salaries in the upper range of each banding.
Specialist skills are in demand:
- Reward
- Strategic resourcing
- Retention
- Talent Management
- Management Development
- Organisational Design and Development
- Global HR leadership
Combine these with an ability to influence at board level, add value to commercial debates and align HR strategy effectively to the broader business strategy and you will secure the highest-paid HR roles.
The first three months after commencing a new role are critical. It is essential to provide effective coaching for senior appointments, to support them with cultural orientation and establishing expectations.
Flexible packages are helpful at a senior level. Research shows a wide range of preferences from candidates, depending on their own work:life balance issues and priorities.
The future
There is evidence to suggest that employers expect more and more from their HR management teams. They are seeking individuals who offer:
- Proven commercial acumen
- Track record of leading business-critical projects
- Client-facing experience
44% of our respondents still feel that HR is perceived as a support function but the trend is for it to become more and more strategic in importance.