Recruitment Matters May 2013

Recruitment Matters Issue 15 May 2013

Trade Association of the Year

What’s inside

The 2 -3 Intelligence and REC talk

Alamy

Tom Hadley considers cooperation with the DWP and Jobcentres, Chris Ansell gives the rundown on growing revenues and Kevin Green talks Twitter Clifton Suspension Bridge: Bristol has weathered the economic storm well

Get to know your local policy makers In April, the REC launched a new series of regional roundtable events, REC Spotlight, which for the first time brought together local MPs and REC members to discuss labour market concerns at a local level.

The first meeting, on 19 April, took place in Bristol and was chaired by REC chief executive, Kevin Green, with Kerry McCarthy, MP for Bristol East, and Stephen Williams, MP for Bristol West, in the hot seats. REC members represented recruitment agencies from a wide cross-section of industries including, engineering and IT, legal, executive search, construction, office support, accountancies, commercial, industrial, health and contact centres.

The topics covered were many and varied but several key themes emerged, from the increasing difficulty some local recruiters have had in finding people to fill highly specialised positions (stress engineers, design, software, manufacturers and so on) and, at the other end of the spectrum, recruiters who place

jobseekers with lower skills identifying a real issue with generational attitudes and willingness to work.

Overall though, Bristol was identified as a city with a buoyant economy that has weathered the recession well. In fact, it is one of the UK’s best performing cities, with major employers such as Airbus, BAE Systems and GKN Aerospace making it a hub for technical and engineering employment.

Kevin Green said it was a “fantastic event” with some “good and lively debate on labour force issues”.

Lasting two and a half hours, these interactive events are free to both REC and IRP members, and provide opportunities for members to discuss their issues, thoughts and ideas for the industry and the chance to influence the REC’s messages and policy.

For information on the timing and location of the next Spotlight events, go to www.rec.uk.com/spotlight Follow #RECSpotlight on Twitter.

4-5Getting online Do LinkedIn and Twitter have to be a hindrance?

Here are our top tips for social recruiting

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Business Matters

The legal low-down on online recruiting and invoice finance tips from Close Brothers

Institute of 7 Recruitment Professionals We speak to Chris Oddy, winner of Temporary Consultant of the Year at the IRP awards, plus tips from Marie-Clara Thaureux, recruitment director at Layton Andrews

best events 8 The and training

The REC introduces its pensions auto-enrolment partners, plus an REC Council election process heads-up

www.rec.uk.com

Leading the Industry

Collaborations between recruitment agencies and Jobcentre Plus can be beneficial for both Tom Hadley, the REC’s director of policy and professional services, considers the impact of co-operation between the DWP and the REC On a bright November morning last year, the Employment Minister Mark Hoban glided into REC HQ in Dorset House to sign a formal partnership agreement between the Department for Work & Pensions (DWP) and the REC. This has proved a significant event on a number of levels. As well as reinforcing government recognition for the industry’s voice, it has provided a catalyst for local level co-operation, which can deliver a number of practical benefits for recruiters.

As part of the REC/DWP partnership agreement, a programme of regional roundtables is currently underway. The aim is to enhance collaboration between agencies and Jobcentre Plus and to explore new ways of working together. Recent meetings in Taunton and Birmingham have set the tone and underlined some of the tangible outcomes that can come from public/ private sector co-operation.

Labour market intelligence. Local employment landscapes are constantly evolving, in particular due to cuts in the public sector and plans to boost potential growth sectors.

This partnership facilitates the REC and DWP sharing views on labour market trends and working together to pre-empt future skills needs.

Access to new candidate pools. Recruiters are reporting significant demand for staff in high-end sectors such as engineering and technology, as well as in other areas such as drivers, care and sales. Building links with local Jobcentres can create a new pipeline of candidates and was one of the outcomes to emerge from recent roundtables.

Updates of government initiatives. A further example of co-operation is ensuring that recruitment agencies have the latest updates on policy developments so that they can then raise awareness of changes with the employers and candidates with whom they work on a daily basis. For example, discussions in Taunton honed in on changes to the tax system (Universal Credit) and the launch of Universal Jobsmatch.

Helping with public sector tender criteria. Recruitment providers working on high-profile publicly funded initiatives, for example large-scale construction projects, will often need to demonstrate that that they are providing opportunities for local jobseekers. Having strong working relationships with local Jobcentres can help meet this criteria.

Facilitating career transitions. An on-going debate is how to facilitate career transitions for those who have been made

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unemployed, for example moving from the public to the private sector. This is an area where specialist recruitment agencies can play a key role. Jobcentre staff are already using their increasing knowledge of the recruitment sector to refer jobseekers to specialist agencies.

Raising awareness of possible funding streams. With more regional autonomy in terms of funding streams, there are real opportunities for recruiters to become more involved in targeted employment initiatives.

Working more closely also helps improve understanding among recruitment agencies about government initiatives such as the Youth Contract and apprenticeships. Recruiters are then able to raise awareness among employers and job candidates.

The role that recruiters can play in this area is something that was expressly recognised by the employment minister at the launch of the partnership agreement and in subsequent discussions with the REC. Significant progress has been made in terms of local level co-operation. However, more can be done to break down barriers and further enhance collaboration. On a practical level, an increasing number of agencies are already working with Jobcentre Plus to source candidates for both temporary and permanent job opportunities. The aim is to build on this and to continue highlighting the practical benefits of public/private sector collaboration.

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• Follow Tom Hadley on Twitter www.twitter.com/HadleysComment

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L-r: Mark Hoban and Kevin Green

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Leading the Industry

the intelligence The View

Fig 1: Median recruitment company revenue growth 20

15

%

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• Follow Kevin Green on Twitter www.twitter.com/ kevingreenrec or connect with him on LinkedIn: uk.linkedin.com/pub/kevin-green/22/a75/221

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0

-5 Mar 11

May

Jul

Sep

Nov

Fig 2: Revenue growth

Jan 12

Mar

May

Jul

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Nov

Jan 13

Fig 3: Sector revenue growth

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30 25

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Nursing & Social care

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Office professionals

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-15 Overall Permanent Temp

Contract

Life sciences

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Industrial

-10

Engineering & Technical

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Education

0 Technology

%

‘May you live in interesting times’ was used

by Robert Kennedy in a speech in 1966 to explain the changing shape of society.

As I engage with recruiters in person or via social media it’s clear how relevant this statement is to our members as both the labour market and the recruitment industry both go through a period of significant change.

The shift to a much more flexible jobs market, where already 46% of working people are in a non-permanent or a non-full time role, is radically different from a just a decade ago. This is creating opportunities for many members, as is the emergence of skill shortages.

While these factors may provide some upside, margin pressure, the growth of intermediaries and a highly competitive market is making times much harder for many recruiters.

One thing that is clear is that the recruiters who are winning in these challenging times are those who innovate or seek to be different. One example of this is the level to which recruiters embrace technology and social media. The candidate database is dead; clients have access to the same tools as us, so our ability to stay ahead of their wants and needs has never been more important.

In much of the market where professional and managerial capability is scarce, the ability of your consultants to find the talent (versus the client’s in-house team) may be the only game in town.

How you attract great candidates who become loyal to your business may be all that differentiates your business from a myriad of similar competitors.

Reasons to be cheerful . . .

Shhhhh. Make sure no one is listening. This is just between you and me. Recruiters are starting to see revenue growth. Yes, it is true. Revenue growth has been steadily improving from the nadir of a contraction of 2.7% in May last year, to growth of 6.4% in February, a further acceleration on what we have pleasingly seen in the last few months (Figure 1).

Where is the growth coming from? With the current level of economic uncertainty and the constant barrage of newsflow of downgrades on the news wires, it is not surprising that growth in the recruitment market is coming from allowing employers flexibility in their labour resource, rather than adding to their fixed cost base. Figure 2 shows that contracting (which is growing at double digits) and temporary are the revenue streams that are growing the most strongly, with permanent recruitment lagging behind, up only 3.3% in February.

Turning now to which sectors are growing the fastest, Figure 3 shows that both Education and Life sciences are both growing at double digits, with Technology not far behind. (Figure 3 also shows that Office professionals is the sector struggling the most, with median revenue contraction of 13.5% in February 2013.)

I have observed before that with temporary and contracting delivering the bulk of revenue growth, recruiters will see a decline in net disposable revenue (NDR), as these revenue streams have lower gross margins due to the recruitment company paying the individual rather than a client, and that means that greater care needs to be taken with overhead cost control. We will look at profitability trends in more detail next month.

• Chris Ansell is chief financial officer at Recruitment Industry Benchmarking (RIB). The RIB Index provides bespoke confidential reports on industry trends. See www.ribindex.com; info@ribindex.com: 020 8544 9807. The RIB is a strategic partner of the REC.

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08/05/2013 13:36

The Big Talking Point

LinkedIn and Twitter can seem daunting, but using them correctly can help rather than hinder your business, says RM editor Francesca Steele

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tandard methods of recruitment have changed completely in the past decade, with social media becoming an inextricable part of the process, both for recruitment professionals and for clients.

LinkedIn is at the forefront of this change. In 2008, the social networking site devoted entirely to professional people, set up LinkedIn Recruiter, which allows headhunters to access and search its more than 187m profiles and contact potential candidates. This division generated $138.4m (£89.3m) in the third quarter of 2012, a whopping 55% of its total revenue.

Many recruiters understandably feel concerned about the potential impact of services that make it easier for clients to source their own candidates. Vincent O’Donoghue, commercial director at internet recruitment training company Social Talent, says that change can be very hard to accept. “It is a massive mind-shift for an industry that has cautiously guarded its information or database of CVs to move to a world where information is so freely shared,” he explains. “However, the reality is that the value, for example of an agency’s

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database of candidates, is being eroded by the fact that the web is becoming such a rich source of human data.”

So, how do agencies and companies cope in a world where all of the cards are face up?

Getty Images

Sourcing talent online The answer, says O’Donoghue, is to add value by utilising social networking sites so that you have a competitive advantage. “If recruiters learn to properly use sites like LinkedIn and add that to the databases, personal connections

It’s important to get the tone right online Mark Pack, associate director at Blue Rubicon communications consultancy There is still real skill and value in what recruiters do – and in a way this kind of competition forces people to be even better. Of course, a company can now go and find people itself that bit more easily. But if you know your market really well, you can do a better job. It’s quite similar to how PR is evolving. It’s much easier for clients to send out releases directly now. But are they targeting the right people in the right way? Are they using the right language?

I think it’s important for recruitment firms and agencies to give their staff proper training on things like LinkedIn. You can learn a bit of it yourself but people are so much more effective when they have learnt to use it properly. Clients would be well within their rights to expect a recruiter to be far more familiar with LinkedIn than they were, and increasingly to have done thorough online checks of candidates as well. Nobody really cares these days I think if someone has a picture of them looking drunk on a Facebook profile. But those sites can be a useful barometer for whether someone’s CV checks out.

Another, slightly less obvious thing to consider is that social networking is a two-way street.

If you can find people they can find you just as easily. Information about companies and individuals is so accessible online now that if someone or something gets a bad reputation people can find out about it instantly. It’s precisely this sort of thing that can make it worthwhile having an employee whose focus is on maintaining and strengthening the company’s online presence.

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Social Talent’s top tips from Vincent O’Donoghue, commercial director

1) Learn how to properly search LinkedIn 2) Optimise your social profiles to showcase your company and your reputation as a recruiter 3) Learn how to expand your searches – think outside the box when it comes to how potential candidates describe what they do on their social profiles.

A software developer on LinkedIn may become a ‘coding ninja’ on Twitter!

Synonym searches will be your best friend

and industry expertise that they already have they can offer a client candidates far better suited to roles than the client can find for themselves.”

And, he adds, the most important piece of technology is still the telephone.

“While we believe that aspects of recruitment are being revolutionised, human relationships are still extremely important. A recruiter may find and attract people online but they will only place them by having conversations and building relationships offline.”

Social Talent, which was set up and is still run by former agency recruiters, offers online courses in things like Online Employer Branding and Online Sourcing. It trains front-line recruiters in the use of web-based technologies to attract and source candidates for their jobs, and curates what it refers to as ‘the technical stuff’ about the internet and social media into what a recruiter can actually implement straight away to attract and find the best talent in the market.

According to industry experts, other social networking sites can be useful too – and many recruiters already engage

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frequently with clients and candidates on more informal sites.

According to a June 2012 survey of more than 1,000 HR professionals by recruiting software maker Jobvite, twothirds of companies already use Facebook to find recruits, while 54% use Twitter to learn about potential candidates’ views and interests.

In November 2012, Facebook launched a social jobs app that aggregates more than 1.7m job listings from Monster and other sites and allows members to share them with friends.

In fact, Facebook has several apps popular with recruiters, including the upcoming Graph Search, which allows users to search for certain words and trends within Facebook, and which our columnist Marie-Clara Thaureux (see page 7) has recently road-tested. “It means that I can be better prepared,” she explains.

“So if, for example, I am taking some clients out for dinner, I can find out which restaurants they like in advance.”

The reality, adds Thaureux, is that many of the best candidates are also not looking for jobs. Social networking sites can allow recruiters to find more passive

4) 23% of all job searches on Google are performed on mobiles. Ask yourself, is your careers site mobile optimised?

Can an applicant actually apply using their mobile phone? Try instead to enable people to apply with their social profile, like Apply With LinkedIn (a free application that all companies can use on their websites) 5) Show off your company’s culture to attract the best-fit candidates on Facebook

candidates on a more informal level.

However, it is of course important to ensure that you do not strike the wrong tone by being too intrusive in the more personal setting of Facebook or Twitter if that is not what clients or candidates are used to, says Mark Pack of the communications consultancy Blue Rubicon.

“There are quite a lot of professions where casual contact-making is absolutely the norm – the media, for example. But others – such as the public sector – are quite formal and making initial contact on something as familiar as Twitter might be seen as quite inappropriate.”

The most important thing, as with every other part of your job as a recruiter, adds Pack, is to get the appropriate training – and then use your common sense.

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08/05/2013 13:37

Legal Update

Using social media: some legal implications PA

by Lewina Farrell, REC solicitor and head of professional services Behaviour: In April, Paris Brown, the UK’s first Youth Police Commissioner, resigned her post because of tweets she had made as a 14-year-old. Her Twitter account was not vetted as part of the recruitment process, but tweets deemed to be homophobic and racist were revealed after her appointment had been made public. This reminds us that we must always be mindful of what we are posting and where, because once they are out there they are almost impossible to delete.

At the same time, it highlights the conflict between protecting an individual’s right to privacy and to free speech, versus what an employer or prospective employer might regard to be unacceptable behaviour via social media.

In Smith v Trafford Housing Trust [2012], the High Court examined whether an employer breached contract by demoting an employee whom it alleged breached its Code of Conduct by posting particular comments on his personal Facebook page. The judge commented: 1. Mr Smith’s Facebook wall “was inherently non-work related… he plainly and visibly used it for the expression of

personal views about matters which had absolutely nothing to do with his work. [It] was an aspect of his social life outside work, no less than a pub, a club, a sports ground or any other physical (or virtual) place where individuals meet and converse”.

2. When considering whether remarks made are offensive or derogatory, an employer should consider the “reasonable reader”. It noted that “the encouragement of diversity in the recruitment of employees inevitably involves employing persons with widely different religious and political beliefs and views, some of which, however moderately expressed, may cause distress among the holders of deeply felt opposite views”.

A business tool: Social media is a valuable business tool, but for agencies issues arise regarding contacts made by (1) employees and (2) clients.

1. Contacts are the lifeblood of an agency and sites such as LinkedIn can be used to source prospective candidates. The agency can protect

Paris Brown was forced to resign these contacts via an appropriately drafted social media policy, backed up by restrictive covenants in the employment contract. Particular attention should be paid to “professional” versus “personal” contacts.

The REC legal team has recently produced a new social media policy, and updated the contract of employment and disciplinary policy.

All documents are available free to REC corporate members at www.rec. uk.com/legal_guide/model-docs.

2. Agencies may find themselves in dispute with a client who claims to have sourced the same candidate via social media, and thus wants to avoid an introduction fee. Long-established contractual principles remain relevant i.e. in order to be able to claim a fee the agency must demonstrate that it was the “effective cause” of the engagement of the candidate. However, this does not give clients carte blanche to avoid fees where they are liable to pay them.

Business development: What can you do if a client is late with a payment?

In the current climate, late payments by clients can be a real concern for recruiters, with as many as one in ten firms citing it as their main barrier to growth.

However, there is a simple solution, according to Close Brothers Invoice Finance, an independent provider of factoring and invoice discounting services. Since 2008 the organisation has produced a quarterly business barometer to gain insight into SME sentiment and the challenges they face.

Invoice finance is the fastest growing form of funding in the UK, which bridges the gap between raising an invoice and it being paid by a client. It can release up to 95% of the value of your unpaid invoices instantly, meaning you don’t have to wait

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for clients to pay you. Close Brothers has an online invoice discounting system called IDeal™, which reconciles unpaid invoices in real time, 24 hours a day, seven days a week.

“The beauty,” says David Thomson, CEO, Close Brothers Invoice Finance, “is that it both improves cashflow and reduces administration time, meaning a business is free to get on with its core activity, such as making sales and generating growth.”

So what are you waiting for? Not client payments, that’s for sure!

You can see more information on invoice finance and read other news items that include statistics from the barometer at www.closeinvoice.co.uk

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Inspiration

Behind the scenes at the Institute of Recruitment Professionals This month we speak to Chris Oddy, who won Temporary Consultant of the Year at the 2012 IRP awards Name: Chris Oddy Agency: Real Staffing Group Years in recruitment: Five Specialism: Electronic engineering How did you get into recruitment?

I studied graphic communication and design but while I was at university I fell into recruitment and then found myself really enjoying it. I loved the idea of a clear career path. I’m a keen marathon runner and the clear, long-term targets in recruitment appealed to that side of me.

What do you enjoy about it today?

I like really getting to know companies. I didn’t know much about electronics when I started but I’ve enjoyed learning about the subject and getting to know candidates throughout their contracting careers. It’s always exciting and new but with a long-term goal too.

Would you like to try another sector?

I’ve gone from electronic engineers to more senior appointments and I’m always on the look-out for a new sector within electronics. I wouldn’t rule out trying a completely different thing either though!

What do you find most challenging?

The technical side of things at first definitely. And also learning how to put the best candidates forward and understanding what clients need has been a learning curve. I realised a year after I first started that sometimes you have to take time to explain to a manager why they should interview someone who might not look as good on paper as someone else. As you gain experience you intuitively understand more about who will be a better fit and how to explain that to someone.

Do you have any particularly memorable placements?

When someone isn’t initially selected for interview and then they eventually get the role after you’ve persuaded the manager to see them, that’s very satisfying. I’ve enjoyed seeing some people embarking nervously on a contract career after being redundant and then start to really enjoy it.

What would you be if you weren’t in recruitment?

Something to do with sport! I’d maybe give marathon running a go, or help sports companies with marketing or something like that. I’m really passionate about all things sports-related. You’ve probably noticed!

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Things I Know Marie-Clara Thaureux, recruitment director, Layton Andrews Confidence is key I was studying to be an actress when I left to go into recruitment and the skills I learnt at drama school have certainly helped me in my new career. To have the confidence to go on stage was one thing but now I interview company directors and they need to feel that I know what I’m talking about. I’m quite young to run a company, I know – I’m under 30 still – but I always make it clear that I’m confident in what I’m doing.

You have to know your subject Some recruiters find interviews quite intimidating but if you know your subject then confidence comes hand-in-hand with that. If you don’t know what you’re saying then your confidence is going to lapse. Both things increase with experience too.

It’s better to work with enthusiastic people We work in the financial services sector in Jersey, finding everyone from accountants to lawyers to private bankers.

It’s mostly mid-management level up, but I always say that I will work with anyone who is really enthusiastic about what they do.

The downturn has been good for recruitment It’s been awful in some ways, of course, but I think it’s made lots of us better recruiters. Some have responded to hard times by CV-pushing but the best ones have become more selective, more focused.

You have to engage with your client I always wanted to set up a consultancy that actually consulted, and we’ve been running for about a year now.

We ensure that we get to know our clients very well. We know our clients – we know when they are selling their house or if they are going on holiday. We know where the growth in their teams is going to be or if they have issues.

We even sometimes know where their parents live! It’s not just a phone conversation, it’s building a real relationship.

To keep up to date with everything the Institute of Recruitment Professionals is doing, please visit www.rec-irp.uk.com

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08/05/2013 13:38

Events and training

Vote now for your REC council!

Pensions auto-enrolment The REC has three expert partners for its half-day pensions workshops across the UK. With their unparalleled experience and knowledge of automatic enrolment (and an emphasis on the supply of temporary workers) they can give you practical information on how you can implement this for your business.

Jelf Employee Benefits As well as demystifying some of the common misconceptions surrounding staging dates and employer duties, this session will guide you through the various choices of pension contribution basis the employer needs to consider, how to select the most appropriate pension scheme for your business and the tactical use of postponement and how this can minimise your costs. There will also be guidance on project planning, soft coercion and an introduction to the hidden cost impact of autoenrolment on other employee benefits.

Safe Computing, in conjunction with InterSoftware This session will take you through the communications your workers must receive by law regarding enrolment – rights to opt out, rights to opt back in and so on – as well as what your systems need to be capable of. For example: can your payroll methods take the right contributions, at the right time, from only the eligible workers, then refund them if an opt-out notification is received?

NOW:Pensions NOW:Pensions is fully committed to recruitment sector auto-enrolment and has already partnered with Blue Arrow, Adecco, Randstad to name a few. This presentation will provide you with a practical step-by-step guide to successful implementation. NOW:Pensions aims to remove the administrative burden from you, the employer, by dealing with all aspects of the communication process, providing a member helpline and guiding you through the implementation process.

Remaining pensions workshops for 2013: 1 May – London; 14 May – Leeds; 21 May – Southampton; 4 June – Glasgow; 5 June – Aberdeen; 26 June – Exeter; 3 July – Manchester; 10 July – Newcastle; 24 July – Birmingham; 11 September – Cardiff; 24 September – London

Recruitment Matters The official magazine of The Recruitment and Employment Confederation Dorset House, 1st Floor, 27-45 Stamford Street, London SE1 9NT Tel: 020 7009 2100 www.rec.uk.com

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Nominations are now all in for the annual election to the REC’s council, and all REC and IRP members can now vote online to elect the people who they want to represent them on council.

Online voting takes place between Monday 20 May and Monday 10 June. Results will be announced at the REC Annual General Meeting on Wednesday 12 June.

“Our council does a terrific job leading the REC’s work to drive up professional standards in recruitment,” said the REC’s chief executive Kevin Green.

“It’s a really rewarding and interesting job and we’re looking forward to welcoming some new faces onto our governing body.”

There are 25 seats on the REC council and this year there are eight positions to be elected, five for corporate members and three for IRP members.

Full details of all the candidates for election and how to vote will be posted on the REC website and communicated to all members by Friday 17 May.

Membership Department: Membership: 020 7009 2100, Customer Services: 020 7009 2100 Publishers: Redactive Publishing Ltd, 17 Britton Street, London EC1M 5TP. Tel: 020 7880 6200. www.redactive.co.uk Publisher: Anne Sadler. anne.sadler@redactive.co.uk Tel: 020 7880 6213 Consulting Editor: Liz Banks liz.banks@rec.uk.com Editorial: Editor: Francesca Steele francesca.steele@redactive.co.uk. Production Editor: Vanessa Townsend Production: Deputy Production Manager: Kieran Tobin. kieran.tobin@redactive.co.uk Tel: 020 7880 6240 Printing: Printed by Southernprint © 2013 Recruitment Matters. Although every effort is made to ensure accuracy, neither REC, Redactive 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 Redactive Publishing Ltd. No responsibility can be accepted for unsolicited manuscripts or transparencies. No reproduction in whole or part without written permission.

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