THE VIEW AND THE INTELLIGENCE
Why your industry needs you p2 BI G TALKI NG POI NT
Uncovering the latest industry trends p4
Recruitment Issue 82 February 2020 Ma ers
LEGAL U PDATE
The end of Swedish derogaঞon contracts p6 PRODU CTS AND TRAI NI NG
Interview: 2019 Recruiter of the Year p8
Best pracঞce
Good Recruitment Collecঞve welcomes th its 500 employer T
he Good Recruitment Collec ve (GRC) started 2020 on a high, with 500 employers now signed up to the Good Recruitment Charter – commi ng them to the highest recruitment standards. The GRC, run by the Recruitment & Employment Confedera on, was set up in 2014 to help employers refine their recruitment strategies and a ract and retain the right candidates. The businesses signed up to the ini a ve, such as Virgin Media, Na onal Express, EY, MacDonald’s and WaterAid, employ more than 3.5 million workers in the UK between them. For Aggreko, a supplier of temporary power and temperature control solu ons, signing up has changed their approach to recruitment. HR Director Valerie Dale said: “We decided to rebuild our en re recruitment processes alongside the Good Recruitment Charter, which has resulted in
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an enhanced candidate experience, shorter recruitment mes and an improved service to hiring managers, and significant cost reduc ons.” At the heart of the ini a ve is the Good Recruitment Charter, which defines good recruitment prac ce through nine principles. Signatories make an aspira onal commitment to these principles, which include being fair and ethical in recruitment, offering flexibility in work, and ensuring good recruitment in supply chains. Good recruitment needs a network Formerly known as the Good Recruitment Campaign, the GRC was renamed in early January as
Making great work happen
part of a broader rebrand at the REC. The aim is to be er reflect the collabora ve nature of the group as those signed up are part of a network of HR and in-house recruitment professionals that they can share ideas with and learn from. Members also benefit from workshops, conferences, peer reviews, self-assessment tools and research data. Tom Hadley, Director of Policy and Campaigns at the REC, said: “The aim of the Good Recruitment Collec ve is to put good recruitment at the top of the corporate agenda. Hi ng the 500 mark is a major milestone. It reflects increasing recogni on that brilliant recruitment is at the heart of economic growth and drives both produc vity and worker well-being. As businesses compete for talent and workers want more out of their work, ge ng recruitment right has never been more important.”
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Leading the industry
the view... Making great work happen transforms lives, says Neil Carberry, REC Chief Execuঞve
I
t takes a lot to silence several hundred recruiters on an awards night, but St. Giles charity did just that. At the IRP Awards last November I had the very happy job of announcing this brilliant organisa on as REC’s official charity partner. And when two representa ves told us in their experience “nothing stops a bullet like a job”, you could hear a pin drop. St. Giles helps people who have experienced abuse, poverty, exploita on or have been caught up in crime to build a be er future. They do this by looking at everything a person needs to turn things around – whether that’s a roof over their heads, training, advice or help ge ng into work. Helping people into good work is at the heart of their approach to tackling some of the biggest challenges facing our society. In 2016/17, one project for vulnerable women who had been caught up in crime helped nearly 800 ex-offenders to find a job. It saw the rate of re-offending halved and, given the costs of incarcera on, it turned every £1 of investment into a saving for the taxpayer of about £10.
“Nothing stops a bullet like a job”
Recruitment is about helping everybody to live their best lives The importance of work and opportunity isn’t lost on any of us. Recruitment is about helping everybody to live their best lives. As an industry we should be proud of the posi ve impact our work has for our candidates, their families and the wider society. We are extremely proud to support such an important charity. Show your support by considering a dona on at stgilestrust.org.uk/donaঞons
If you want to keep up to speed with all things recruitment then follow me on Twi er @RECNeil
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NE TWOR KING
Think local, drive change Your industry needs you, says Tom Hadley, REC’s Director of Policy and Campaigns
I
n 2019, more than 1,000 recruitment industry leaders got involved in our regional Brexit seminars, IR35 workshops and high-profile roundtables with public figures like Manchester’s mayor Andy Burnham. The aim is to build on this and ramp up our industry’s voice locally and na onally. The REC’s 18 sector groups have provided support to members and driven campaigns based on industry priori es. We’re honing in on regional and sector specific challenges and opportuni es. Why? 1. Voice – the debate around skills and good work is increasingly devolved. We need a strong regional presence to influence the agenda. 2. Poli cal engagement – engaging with local MPs creates a different sort of rela onship that will support our ac vi es. 3. Compe ve advantage – employers look to their recruitment partners for exper se. 4. Brand trac on – organisa onal leaders are expected to have a view on big issues of the day, skills and good work included. 5. Promo ng the Good Recruitment message – regional Chambers of Commerce and other business organisa ons can help us. Helping industry leaders to build their exper se and brand in their region is one of the aims of the Future of Recruitment Forums which we are rolling out in associa on with LinkedIn. We are also suppor ng business leaders to be ‘ac vists’ and play an ambassadorial role in their region to influence the localised skills agenda and to showcase our industry’s role in making great work happen. REC members, your industry needs you! You can follow Tom on Twi er @HadleysComment
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Leading the industry
the intelligence...
66%
Employers feeling confident on 2020 prospects Josh Pren ce, REC Research Officer
E
mployers were looking into the new year with op mism despite a tough ride last year and a gloomy economic outlook for 2020. Over the course of 2019 the REC’s monthly ‘JobsOutlook’ report saw employer confidence fall to new lows. Confidence in the economy dropped to a net figure of -34 in August-October 2019, while employers’ hiring confidence fell to net -8 in September-November. In November 2019, the REC also surveyed employers about how they felt the economy and their businesses would fare in 2020. Unsurprisingly, confidence in the economy’s prospects was very low: 66% employers thought that economic condi ons in the UK will be worse than in 2019, while
only 4% of employers thought they would be be er. With a resul ng net confidence level of -62, that’s down four percentage points from November 2018. Yet despite all this, 92% hirers thought that their own business would perform as well or be er in 2020 than it did in 2019. of hirers thought that Overall, employer confidence their own business in their own companies’ would perform as well prospects for 2020 was at net or be er in 2020 than +37 – down only 2 points from it did in 2019 the same me a year earlier. So although the business community is very worried about the wider economic outlook, they have faith that their own firms will be able Overall, employer confidence in their own to find a way through the companies’ prospects for uncertainty. In many cases, they 2020 was at net believe that they can thrive. This should be welcome news for recruiters as they have a
92%
+37
Only one in five are new clients New clients as a percentage of total clients (%), Q3 2018/19 34% 34% 26%
20%
17% 9% £0 Q3 2018
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Q3 2019
New clients as a percentage of total clients billed by the average recruiter in the RIB Index in Q3 2019 was notably lower than in the same period last year – down from one in three to one in five. Such a significant change is reflected in other recruitment industry trends –
employers thought that economic condiঞons in the UK will be worse than in 2019
crucial role to play in the success of their clients. Once business confidence starts to recover and hiring ac vity increases, agencies must be ready to show the added value they can bring to their clients. According to ‘JobsOutlook’, employers have consistently reported that quality of service and an agency’s exper se, in terms of the regions and sectors they cover, are the most important factors when it comes to choosing a recruitment agency to partner with. Recruiters should look to improve these parts of their offering to ensure that they are adding maximum value to their clients and helping them to succeed.
notably the REC’s ‘JobsOutlook’ – that employer confidence in making hiring and investment decisions is at an all- me low. As a consequence, it is likely that fewer firms currently need to appoint new recruitment partners. For the median recruiter, this resulted in an average of 7%
fewer clients billed across Q3 2019. While fewer clients does not necessarily result in lower revenues, it does mean recruiters need to intensify efforts to sa sfy exis ng client requirements – which are also likely to be fast evolving due to the current market uncertainty.
Belinda Johnson runs employment research consultancy, Worklab, and is Associate Knowledge & Insight Director of Recruitment Industry Benchmarking (RIB). The RIB Index provides bespoke confidenঞal reports on industry benchmarks and trends. www.ribindex.com
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Industry trends
big talking point
Rolling with the punches Taking a look at the latest recruitment industry figures, you can see recruiters are ba ling a challenging market – and surviving it well.
B
y now, everyone in the recruitment industry will be ge ng used to opera ng against a backdrop of vola lity, uncertainty and change. But the REC’s latest Recruitment Industry Trends (RITs) demonstrates that the industry’s businesses and employees rose to the challenges and capitalised on the opportuni es. Of the challenges that dominated the 2018/19 financial year, several made their presence felt in this year’s report: • The ongoing uncertainty around Brexit and its impact on hirers’ confidence and investment decisions • The con nued fall in immigra on to the UK for work, par cularly from the EU, which caused fluctua ons in availability of labour and skills • The first full-year impact of the offpayroll reforms in the public sector and the corresponding need to provide increased levels of PAYE support for workers in this sector • Catering for an average pay growth of 3.1% • Managing an increase in official vacancies of 5.2%, mostly for permanent roles.
The industry conঞnues to adapt
The RITs figures con nue to reflect that an increasing number of REC members are diversifying as they emphasise their ability to act as expert partners 4
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The industry mix £38.9bn
The employees 119,000
the number of people employed by the recruitment industry, up 3% on average on 2017/18
57%
the number of REC members reporঞng turnover rates of more than 30% among their consultants
and solu ons providers. Many have expanded from tradi onal staffing agencies to act as outsourcing partners for both permanent and temporary roles, as well as offering other HR services. The turnover of the industry as a whole has grown to £38.9bn in 2018/19, from £35.7bn in the previous year. Other figures show a mixed picture of the industry responding to circumstance and working hard to maintain margins and to find the right candidates. There are clear concerns for growth for the year ahead. Half of recruiters cited the deteriora on in client confidence as an important issue for permanent recruitment. A third of respondents are wary of legisla ve change and pressure on margins for temporary and contact recruitments. And the biggest challenge for the industry that refuses to go away? A shortage of suitable candidates. But with recruiters iden fying investment opportuni es to help them develop more strategic rela onships with clients – including understanding regulatory developments, providing feedback on employer brand and candidate percep ons and accessing regional and sectoral knowledge – the industry is preparing for whatever the economy throws at it. “2018/19 was an extraordinary year that showed the country what professional recruitment is made of. RITs tells a story of an industry that grew in the face of an incredibly tough environment marked by candidate shortages and economic uncertainty. Despite all that, we helped even more people to find work,” said Neil Carberry, REC Chief Execu ve. “In mes like these, recruiters have proved themselves to be valuable partners for businesses that want the edge the expert knowledge of professional recruiters brings to the table. All this data is encouraging and I hope recruiters will find it a useful tool in tackling the challenges ahead – making great work happen with the same grit and determina on we saw last year.” www.rec.uk.com
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the total industry turnover, generated by 31,140 businesses
5%
the increase in the number of enterprises involved in permanent recruitment, compared to a 2% fall for those supplying temporary/contract workers
86%
the proporঞon of turnover delivered through temporary/contract placements
87%
the proporঞon of micro-businesses (1-9 employees) in March 2019 among those companies dealing with predominantly permanent placements, compared to 69% of those oriented towards temporary/contract workers – both down 1 percentage point on March 2018 figures
The candidates 1.07 million
the number of permanent placements made, compared to 1.14 million last year
1.1 million
the number of temporary/contract workers on assignment on any given day in 2018/19
2%
the drop in the number of EU naঞonals sourced for permanent roles (and higher for conঞngent labour)
The money £5,152
the average value of permanent placements from the wider recruitment industry, up from £4,238. But average margins have fallen from 15.4% to 14.7%
£30,219
the average annualised turnover of each temporary/ contract worker on assignment, generaঞng an average margin of 17.3% (only marginally lower than 2017/18)
3.8%
the average operaঞng profit recorded by the industry
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Swedish derogaঞon
legal update Preparing for the end of Swedish derogaঞon contracts By Jane O’Shea, REC Solicitor
O
n 6 April so called ‘Swedish deroga on’ contracts (SD contracts) will be brought to an end with the repeal of regula ons 10 and 11 of the Agency Workers Regula ons 2010 (AWR). Under these contracts, agency workers give up the right to equal pay with comparable permanent staff in return for a guarantee to receive a certain amount of pay when they have gaps between assignments. Under the new rules once a worker has been in a role for the 12-week qualifying period, they will be en tled to the same pay as a permanent employee. Here is an overview of the op ons open to agencies
Own the change in 2020
Find out more at: h ps://www.rec-irp. uk.com/membership
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“It is advisable to engage with workers early and to agree a new contract” when dealing with SD contracts: 1. Conঞnue with current SD contracts: the new rules will not automa cally mean the termina on of SD contracts and these employment contracts will con nue if no ac on is taken. But from 6 April any clauses that refer to workers waiving their rights to equal pay will be null and void. Where contracts are not being terminated agencies must provide qualified workers with a wri en statement confirming that they are en tled to equal pay under the AWR on or before 30 April. 2. Terminate the SD contract before 6 April: the rules
T
he Good Work Plan legisla on comes into effect in April 2020, so it’s me to step in, step up and own this transforma on. Think about the strategies you need to put in place to adhere to the five principles of the Good Work Plan, namely: 1. Sa sfac on 2. Fair pay 3. Par cipa on and progression 4. Wellbeing, safety and security 5. Voice and autonomy.
around agencies termina ng in this manner are very strict and it can only be done if all of the condi ons of Regula on 10 (1)(c) and (1)(d) are sa sfied. Agencies that wish to terminate contracts in this manner should seek specialist advice in order to minimise risk. 3. Amend the SD contract: where new contracts are not being agreed with workers, agencies should take steps to amend the current contracts to ensure that it is clear that the pay between assignments, and obliga ons under Regula ons 10 and 11 of the AWR, will no longer apply. Any varia on to contracts must be done with the workers consent and legal advice should be taken before making amendments. 4. Terminate and agree a new contract: it is advisable to engage with workers early and to agree a new contract where the worker voluntarily agrees to end their SD contract. Agencies that will be impacted by the new rules and who have not yet sought specialist advice should do so immediately. For more informa on on the repeal of SD contracts, see the REC’s Swedish Deroga on toolkit online, which includes detailed guidance and a checklist to help prepare for the changes.
The REC’s three pillars of a successful employee reten on strategy are a good place to start: • Train your consultants to make sure they’re at the top of their game • Recognise them to boost their credibility among your clients • Reward them for their contribu ons to your business growth to cement loyalty. We’re here to offer our expert guidance and services to ensure you and your team have everything you need to succeed. www.rec.uk.com
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Inspiraঞon
Hilary Barnes, NHS
pracঞঞoner, on life as an agency worker Flexible working allows me to be who I want to be. I’ve been working flexibly since 1997 as an opera ng department prac oner in the NHS – suppor ng surgeons and anaesthe sts, o en at three different hospitals each week. If I went into nursing it meant I would have to retrain, and do a job that’s quite physically demanding, involving long hours for less money. Instead, at the age of 46, I went back to drama school. Now I’m able to fit work around a ending audi ons. And I’ve achieved my ambi on of being an actor!
When you’re going into new environments, where everyone is stressed, it’s important to know www.rec.uk.com
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Q&A
What I know
Behind the scenes with REC Professionals
your agency has your back. I’ve always got my work through Pulse Jobs. It’s very important I know they’re there to help. They’ve known me for years. They believe in me. But they are also very approachable and they’re always at the other end of the phone for support, especially when I’ve suffered bereavement. So what do I value most in my agency? The human touch.
Big agencies can sঞll get that right. I don’t always get to speak to the person who originally contacted me for a job. But by sharing informa on between colleagues and recording the details, I don’t suffer for it at all.
Gary Venner, Managing
Director, Premier Jobs UK, on sharing best pracঞce
Premier Jobs was invited to share its recruitment best pracঞce by the Parliamentary Review. Why do you care about that?
clients, having the right exper se and becoming trusted advisors. The recruitment industry only stands to benefit if more of us share our best prac ce and ways in which to find growth.
The Parliamentary Review is designed to share best prac ce with business leaders and policy makers. And while there is poli cal turmoil, Brexit uncertainty and industries are changing at a rapid pace, the country survives because business leaders are simply ge ng on with running their firms. Everyone can learn lessons from those doing it successfully. As we established our company in 2007 in the financial services sector, we’ve got a good story to tell about adap ng to challenges and market changes, finding new, lifelong
You’re also keen to get more candidate reviews on Trustpilot and Google – why? Recommenda ons build a business. We live and breathe the REC code of prac ce every day. It helps our business prosper. But reviews keep our feet firmly on the ground and shape everything we do. We want to understand what others are saying about us – and the only way to keep reviews high is to deliver what candidates and clients like. It’s about being the best you can at all mes.
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Products & training
IRP Award Winner Georgia Walden, Senior Recruitment Consultant at Hyper Recruitment,
on what lies behind her recent win as Recruiter of the Year at the IRP Awards. How did you get into recruitment? The career chose me. I didn’t really know about recruitment when I le university with a Master’s in science. I received a call from a manager at Hyper Recruitment Solu ons, who described the company, how I could use my degree and the role recruitment played in helping people. It was more than helping candidates find their dream job and clients finding the best person. As the company specialises in science, the knock-on effect of placing someone who could play a part in crea ng life-saving drugs and life changing technologies was so inspiring. I joined the graduate scheme in 2016 and haven’t looked back since.
What do you think has driven your success over the past 3.5 years? The opportuni es to progress have been amazing. I’ve changed desks and had the chance to do something new. The training and support I’ve received from more experienced colleagues when I’ve faced challenges has been fundamental to my success. But my mo va on remains the importance of helping people. It makes my job so much more enjoyable. My favourite stories are about placing graduates struggling to find work, or those finding it hard to come back a er a career break. It’s less about the commission, more about the sa sfac on of helping others.
What’s been your biggest challenge? I moved from the biologics desk where I was one of the highest billing consultants in the company, to a new regulatory start-up desk – billing nothing. I’ve persevered through the tough mes. I’ve learnt about a sector I knew nothing about. I’ve even a ended a course that is aimed at regulatory professionals, so that I can be er understand what it takes to do the job. One of my new clients had
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struggled for over a year to fill a role specialising in personal protec ve equipment such as gloves and masks. However, I believe I’ve found someone suitable by going way out of the market. Another example was a start-up company, whereby I managed to fill 15 specialist roles (nego a ng on the high salaries that come with that), essen ally helping to build a company. I hadn’t done anything like that before.
Hyper Recruitment Soluঞons also won the ঞtle of Recruitment Company of the Year for the second year running at the IRP Awards. How important is that to you – and the team you work with? The team makes a massive difference, especially on those days where things aren’t going so well. The same goes for the environment you work in – and that is influenced by training and the posi ve a tude from management down, even when you mess up. I’d heard recruitment was cut-throat, but I’ve never seen that here.
What advice would you give recent recruits into the industry? Keep posi ve. Keep focused. Recruitment can be very driven by your targets, but remember your team, your business, the sector that you work in – and that you are a part of something bigger.
Membership Department: Membership: 020 7009 2100, Customer Services: 020 7009 2100 Publishers: Redac ve Publishing Ltd, Level 5, 78 Chamber Street, London E1 8BL Tel: 020 7880 6200. www.redac ve.co.uk Editorial: Editor Pip Brooking Pip.Brooking@rec.uk.com. Produc on Editor: Vanessa Townsend Producঞon: Produc on Execu ve: Rachel Young rachel.young@redac ve.co.uk Tel: 020 7880 6209 Prinঞng: Printed by Precision Colour Prin ng © 2020 Recruitment Ma ers. Although every effort is made to ensure accuracy, neither REC, Redac ve Publishing Ltd nor the authors can accept liability for errors or omissions. Views expressed in the magazine are not necessarily those of the REC or Redac ve Publishing Ltd. No responsibility can be accepted for unsolicited manuscripts or transparencies. No reproduc on in whole or part without wri en permission.
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