5th May 2020.
Sherrington is an executive search firm recruiting senior management and board level positions for clients across the North West and North Wales.
There are generally speaking three main reasons that organisations recruit; Expansion, Restructuring or Replacement. In the crash of 2008, I was running the commercial arm of a leading UK sales recruitment business and the first thing to happen immediately after the crash was that virtually all ‘expansion vacancies’ dried up – almost overnight. Then as the crisis deepened this was followed by (but to a lesser extent) a long and lingering decline in ‘replacement vacancies’ – in other words, those organisations who lost members of staff in certain roles were deciding not to replace them. But then as businesses started to adapt and create new structures for the new environment, the ‘restructuring vacancies’ began to emerge, which is really what kept our recruitment business afloat during the recession that followed.
It’s not surprising then that we’re seeing a similar pattern following the lockdown caused by the Covid-19 pandemic, although in some ways it feels like the process is happening much quicker. Our business is executive search and the week before the UK lockdown kicked-in we began to see clients announcing wholesale recruitment freezes for all but essential positions, followed by ‘in-progress’ assignments being placed on-hold until further notice. The difference between the crash of ‘08 and the Covid-pandemic however, is that the unlike ‘08 where the banking systems were fundamentally broken, the financial systems of today are still functioning despite the global economy effectively being ‘on-hold’. Whilst there is no doubt the ramifications of Covid-19 are immense and will be felt for many years, this fact does give hope for a swifter recovery in many sectors providing businesses can adapt.
Given the significant impact the lockdown restrictions have had on so many businesses and the possibility of a lingering virus, it would be naive to think that recruitment will simply pick up where we left off once the lockdown is lifted, but we are already now seeing the emergence of ‘restructuring vacancies’ in the planning stages, which itself feels much quicker than in 2008.
We’re also beginning to see several organisations electing to hire candidates for key positions having only conducted ‘virtual interviews’, rather than ‘in the flesh’, something that was unheard of before the lockdown but is a great example of corporate agility enabling business to continue. For recruiters supporting clients with this scenario, in an ever-competitive sector, their ability to help their clients navigate through the changing landscape will be what separates winners and losers.
Organisations always need great leaders which is why the executive end of the recruitment market has historically been very resilient during periods of economic uncertainty. The broader recruitment sector will play a key role in rebuilding the economy as we emerge from lockdown which is why I’m cautiously optimistic about the future, but recognise the need to adapt will be greater than in any time the industry has ever experienced and only those recruiters who can do so quickly and sustainably will survive.
As Chair of the Institute of Directors in Cheshire, I’m talking to many businesses in a variety of sectors on a daily basis and recognise that the challenges are unique to each organisation, but where there is inevitable anguish in the short term, there are already opportunities emerging for forward-thinking businesses who have been able to quickly transition from firefighting and disaster management into future planning and strategic thinking.
The inevitable increase of home-working post-Covid is something that has been discussed a lot. The possibility of a large-scale shift from ‘place-based’ working to home-working for certain professions could have real consequences for employers – why confine yourself to a local talent pool if the candidate could work from home? If the proximity to the employer is no longer a factor in choosing a job, how do businesses then compete for talent on a national or even international level when they’ve only ever previously had to consider their local competitors? These are questions some businesses are already thinking about and whilst the current picture is turbulent, as we begin to settle into a new norm over the coming months, entrepreneurial players will inevitably be shaping their talent plans to support their growth ambitions accordingly.
MD, Sherrington Associates – Executive Search Consultants