Market update – May 23
“Larger firms seem more cautious than SMEs, what does it mean for job seekers”
As I write this, there’s a lot of data out there that’s been published of late. Inflation is falling, but not as fast hoped for, the IMF has revised its figures upwards for the UK economy, and some large firms have reported their results. We’re in more complex times than before the pandemic, but let’s be honest the years after the financial crisis were low growth. There’s lots of innovation taking place and at some point, we all know the world will find calmer times.
What is Fram’s experience? Larger firms seem more cautious than SMEs in financial services. There is very much an air of “wait and see”, although nobody ever tells you what they’re waiting for or what exactly they’re looking for. However, I suspect everyone nods sagely as if we’ll all know it when we see it. Small firms seem more positive and are building now for better times, which looking at the data don’t seem too far away. Perhaps it’s a good time to pick up some strong people, those who are growing faster than their employer. Those who feel bureaucracy is holding them back. “Wait and see” is a difficult thing to manage. It’s hard to motivate teams for that mindset. Strangely, given where rates are, those in the lending industry seem to be busy and we haven’t seen demand spike for collections and recoveries professionals. Asset management has been quieter, and fintech and VC too, but I think September will see a significant improvement in conditions all round. Is this hiatus a good thing? I don’t know. Ideally, firms would be positioned for any upturn in confidence. We definitely feel more teams are suffering from burnout. People have been through so much in the last three years (very few in financial services were furloughed) and resilience isn’t endless, and so perhaps a hiatus is needed.
The current environment has a very real impact for job seekers and normally it takes some time for applicants to realise that the environment has changed. In short, the pay uplifts we saw during 2022 have disappeared. Firms are offering much less of a premium to attract job seekers. Whilst there’s still flexibility, firms are much less flexible than in the last three years. It’s interesting as the media message has been that bosses were 100% sold on home working, but I sense the tide has turned. Hybrid is here to stay, but I think few firms will offer more than two days a week at home in a year or two. Perhaps it will be one day per week at many firms. Individuals work well at home, but teams are built in person. Hybrid is working well at Fram, and I think most bosses would say it works really well for them too, but fully remote or a day a week in the office probably works well for very few. According to Capterra, a third of UK employees said their company uses surveillance and monitoring tools. With attendance (79%) and time management (65%) being the most tracked items. Golf course usage mid-week has also spiked, with 4 p.m. on a Wednesday according to some surveys seeing an explosion in demand. Stats like this probably don’t help the hybrid debate, but my experience is that the vast majority of people are very conscientious. Quite often candidates won’t interview with Fram outside of lunchtimes or after work. There is more flexibility on this than there used to be, but it still shows that the vast majority really want to deliver at work.
The other effect for job seekers is that you need to allow a longer timeframe for your job search. Good candidates are always snapped up quickly, but firms tend to move slower when they feel the market has cooled. Equally, the competition is greater. Firms will attract candidates who meet more of their criteria and those serious about moving prepare better than ever.
Naturally, some firms will be wondering what their Talent teams do during a slowdown. In my experience, they will be building out their networks, improving brand positioning, and identifying skills weaknesses. Busy, but in a different way.
We will be running a series of learning events for HR executives and leaders during 2023. These are a great forum to gain market insights and to network. Please contact my colleague, Fiona Wallace, to register your interest for future events: [email protected]