Recruitment Matters January 2014 by Redactive Media Group

Recruitment Matters Issue 21 January 2014

Trade Association of the Year

What’s inside The Intelligence 2 -3 and REC talk Rex

The year gone by and the year ahead from the REC experts

George Osborne announced funding for apprenticeships in his Autumn Statement

More apprenticeships in the government’s 2014 plan We have long petitioned in these pages for more government support for apprenticeships. So it was exciting to hear George Osborne’s announcement in his Autumn Statement last month that he is setting aside £40m in funding for 20,000 additional higher level apprenticeships focused on science, technology, engineering and maths. Business secretary Vince Cable said of the move: “My ambition by 2015 is for every school leaver to look at a university degree and a high level apprenticeship as different but equal in terms of desirability, future employability and earning potential.” In addition, Osborne allocated an additional £10m for Jobcentre Plus and local authorityled traineeships for 16-17-year-olds, as well as setting in motion a fundamental shift that enables employers to receive direct government funding for apprenticeships. Such a measure gives employers much greater control over the content of what is being delivered. “This should result in both a system that responds to current and future employer needs, and a broader and deeper talent pool from

which recruiters can source the right candidates to help their clients grow,” explains Ben Farber, senior policy advisor at the REC. There were other things of note to the recruitment industry in the Chancellor’s statement. The government has also announced a crackdown on the use of employment intermediaries that enable ‘false selfemployment’. “While we support the principle, we are wary of the rhetoric that might tar legitimate contractors with the same brush,” says Farber. “However, HMRC got in touch with us directly immediately following the conclusion of the Autumn Statement to clarify the Chancellor’s comments, and we understand from them that this crackdown will be focused on the ‘personal service obligation’ – the right to send a substitute. The initial steer we’ve received from HMRC is that the right to substitution will no longer be a consideration when determining whether or not someone is genuinely self-employed.” Visit the REC website to keep abreast of all the latest news and views on the industry. www.rec.uk.com

The winners 4-5 at the IRP Awards Who were the winners at one of the biggest events on any recruiter’s calendar

Update and 6Legal Business Matters The legal lowdown on 2013 and how Personnel Checks can speed up DBS

Institute of Recruitment Professionals We speak to the winners of Recruiter of the Year and Lifetime Achievement awards

best events and training 8 The How the Recruitment Business Academy can help you

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08/01/2014 11:06

Leading the Industry

the intelligence On the up – so what next?

Fig 1: Median recruiter turnover growth 10

Job creation is growing, but how can recruiters build on this, asks Nina Mguni

8 6

How many applications do you receive for a typical position? 251> 0% 201-250 0% 101-200

5.6%

76-100

5.6% 33.3%

51-75

38.9%

26-50 11.1%

11-25 <10

5.6%

What percentage are typically not qualified for the position? <10

11.1%

11-25> 0% 26-50

16.7% 33.3%

51-75 76-90 90>

16.7% 22.2%

Source: Candidate Experience Awards 2012

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2 0 -2 -4 Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 11 12 13

Fig 2: Median average placement salary 32.5

£,000

27.5

25 Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Oct 11 12 13

Fig 3: Median revenue growth & UK job vacancy growth 20 ■ RIB median revenue ■ ONS vacancies

15 10 %

changing relationship between client and agency recruiter. According to the LinkedIn ‘Global Recruiting Trends Survey 2013’, the top priority for in-house recruitment is to recruit and source highly skilled talent. But within this context the hiring landscape has adapted and the challenge is for the recruitment industry to adapt in response. ‘The Client Paradox’ highlights the need for improved candidate communication before, during and after the recruitment process to optimise applicant volumes. A poor candidate experience has the dual effect of deterring candidates away from the employer brand and the brand in general. ‘The Client Paradox’ reports that 20% of applicants are also customers of the employer brand and 17% of people would share a poor experience through social media. The recruitment industry has key strengths to build on; it invests time into developing relationships in order to access low volumes of specialist skills, has keen market insight and intelligence, and access to talent pools. But enhanced candidate experience will also include soliciting candidate feedback at all stages of the recruitment process. There are opportunities to make use of the technological advancements to better source and proﬁle candidates, and harness the increasingly available sources of credible information about candidate performance in professional communities and online work platforms.

The December 2013 ‘Report on Jobs’ pointed to reasons to be optimistic this year. It found growth in month-on-month permanent and temporary placements, showing the pace of growth in job vacancies accelerated to the strongest rate in 15 years, and permanent starting salaries grew at their fastest rate in six years. All in all, this suggests that job creation is likely to be far more active in 2014 than we have seen in recent years. Yet amidst this activity, the recently published REC report, ‘The Client Paradox’, challenges recruiters to up their game to maintain their reputation as the most valued source of quality hires in the eyes of HR professionals. The report explores the

5 0 5 10 Jan 10

Jun

Jan 11

Jun

Jan 12

Jun

Jan 13

Jun

Sep

Vacancies available In the previous editions of Recruitment Matters I have frequently commented that declining growth in labour vacancies was a worrying sign for recruiters. Figure 1 shows that although the median growth in recruiters’ revenues in October of 3.4% represented real growth of 1.2% (ie. greater than inflation), it was the slowest growth for 12 months (we exclude the abnormally low figure in March, which was affected by the timing of Easter). The decline in turnover growth has partly been driven by a decline in the median average placement salary over the last six months of 11% to £27,971, as seen in Figure 2. What is interesting is that the decline to recruiters’ revenue growth has occurred despite strong growth in reported vacancies (Figure 3). We hope that recruiters will be able to share in vacancy buoyancy as 2014 unfolds. • 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.

www.rec.uk.com 08/01/2014 11:07

Leading the Industry

A Campaign’s Odyssey Tom Hadley, the REC’s director of policy and professional services, looks at the year ahead

The View

And so we emerge, bleary-eyed but ready for action, into the bright and shimmering new year. Plenty to get stuck into on the policy front – from major set-pieces like the European elections and the Scottish referendum to industry-specific priorities like the Conduct Regs review and consultations on offshore and onshore intermediaries and selfemployment. Here are four broad priority areas that we will driving over the coming year: 1. Delivering the best possible regulatory landscape – Our aim is to ensure that the UK recruitment industry continues to thrive by fighting for the best possible regulatory and taxation landscape. Specific areas under this heading include ensuring that regulations on our sector (Conduct Regs, GLA, DBS) are workable and enable compliant businesses to thrive. We will also be doing everything possible to influence procurement policy and will continue to push for a level playing field on tax (VAT models in the healthcare sector, travel and subsistence schemes) 2. Influencing labour market policy – Our aim is to promote and champion a dynamic and flexible labour market. Specific areas under this heading include skills and immigration policy, public/ private sector co-operation (as part of the REC/DWP Partnership Agreement), flexible work, youth employment and diversity. 3. Supersizing our ‘circle of influence’ – Our aim is to promote general awareness and recognition amongst politicians and employer bodies for the positive contribution of our industry and to influence the broader political debate. Specific areas under this heading include continuing to build links with senior Labour Party officials, influencing party manifestos, promoting the REC’s ‘Good Recruitment Charter’ and continuing to drive our public sector resourcing campaign 4. International voice – As members of Ciett and Eurociett (the representative bodies for global and EU-wide recruitment industry) we will continue to actively support campaigns to lift restrictions on our sector across the EU and the rest of the world. This will include having a strong presence at the 2014 Ciett World Employment Conference in Brussels, working collaboratively with other national federations and providing regular member updates on EU and International developments. The recruitment market across most sectors is picking up. Our mission in 2014 is to help this growth to accelerate by driving for the best possible regulatory landscape. As ever, the ongoing input of REC members will form the life-blood of our campaigning work.

We anticipate this year being full of opportunities for the UK recruitment industry. The economy is forecast to grow, with most economists’ predictions running well above 2%. We are forecasting that in our sector growth will accelerate to 7.3% up to April 2014 and to above 8% in the second half of the year. The challenges will remain margins and candidate availability. Procurement specialists remain focused on getting more for less so the pressure on fees will remain. Successful recruiters are pushing back by redefining their offering to meet these new realities and focusing on SME clients who don’t have the volume to use intermediaries or have procurement specialists. The REC will be launching a major initiative called the Good Recruitment Campaign, which includes an aspirational charter for employers to sign up to. This is a great vehicle to educate the clients of our members in their use of their recruitment partners. The second challenge in many managerial and professional markets is the growing shortage of skills and talent. In 2012, the REC/KPMG ‘Report on Jobs’ showed 14 areas of skill shortages; last year the number rose to 47 and is accelerating month-on-month. This means we are re-entering a candidate-driven market. Successful recruiters will need the content to attract the talent, as well as the ability to build meaningful relationships in their particular niches. On the political front, the Scottish referendum will create huge debate north of the border. We agree with other business organisations – the UK has one labour market that is functioning well and now is not the time to create uncertainty. However, if Scotland does choose to go it alone we would continue to service our members in an independent Scotland. As the next general election (May 2015) comes ever closer we are seeking to influence the manifestos of all the major parties. In particular, we are concerned by the anti-business rhetoric of the Labour Party. We are working incredibly hard to build relationships with the labour movement to ensure that our market is not unduly affected. All in all this year will be the first of meaningful growth for a very long time. It will provide a positive backdrop for recruiters to take advantage of a growing market. We will of course be right by your side for whatever you need.

• You can follow Tom on Twitter www.twitter.com/@hadleyscomment

• You can follow Kevin on Twitter www.twitter.com/@kevingreenrec

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08/01/2014 11:07

IRP Awards

Titans of industry at the IRP Awards

What a night. Clockwise from top right: Sir Alec Reed, Vicki Walker, the dancefloor, Stephen Perkins, Star, Amoria Bond, Louise Smith, Jeremy Vine, all the winners together on stage

The UK’s top recruiters gathered last month to celebrate the best in the business

hat a year it has been for recruitment. As REC chief executive Kevin Green put it at the REC’s Institute of Recruitment Professional (IRP) Awards last month: “The UK has the most agile, dynamic and resilient recruiters in the world.” And they have all been hard at work this past year. Hundreds of recruiters came together at London’s Marriott Hotel last month to celebrate the industry’s top professionals at the sixth annual IRP Awards. Hosted by the illustrious BBC presenter Jeremy Vine, it was an incredible celebration of the industry, with an atompshere described by one attendee as ‘electric’. The Overall Recruiter of the Year award went to Vicki Walker of CK Group. The judges said that by demonstrating

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“recruitment excellence and being a role model for the rest of the industry”, Vicki had shown “that she could step into a leadership role early in her career”. “This was a great year for entries as members recognise the value that being shortlisted can have on their business, and I would like to thank everyone that entered and supported this year’s awards,” said Green. “Congratulations to all of the 2013 winners who have demonstrated that they are at the top of their game and who are setting world-class standards to which all recruiters can aspire. The high volume and calibre of entries this year demonstrates how the REC’s commitment to raise professional standards is having an impact across the industry.”

www.rec.uk.com 08/01/2014 11:09

The Winners • Lifetime Achievement Award: Sir Alec Reed • Overall Recruiter of the Year: Vicki Walker, CK Group (Read our interviews with Sir Alec and Vicki on page 7)

Individual • Best Newcomer of the Year: Ben Richardson, Lawrence Harvey • Permanent Consultant of the Year: Vicki Walker, CK Group • Temporary Consultant of the Year: Stephen Perkins, Orgtel • Business Manager of the Year: Ray Metcalfe, Encore Personnel Services • Business Leader of the Year: Jason Bowler, Resourcing Group • Best Candidate and Client Experience: Jodie Rafferty, Dynamite Recruitment Solutions • In-House Recruiter of the Year: Louise Smith, SThree IMA • Interim Consultant of the Year: Jo Sweetland, Green Park • Executive Search Consultant of the Year: Jonathan Swain, Penna Company • Best Back-Office Support Team: Star • Best Contribution to the Community: Amoria Bond • Best People Development Business: Amoria Bond • Best Company to Work for (up to 20 employees): Cognitive Group

The Lifetime Achievement Award This year’s Lifetime Achievement Award went to Sir Alec Reed, founder of Reed Executive and a giant in the recruitment industry. Born in 1934 in Hounslow, south London, Sir Alec set up his first employment agency aged 26 in 1960. Fifty-three years later and Reed has grown into one of the UK’s largest private businesses, with more than 3,000 permanent employees working across 425 business units in 180 locations worldwide. “I’ve had the most fantastic life possible and it was because I went into employment,” said Sir Alec on receiving his award to cheers and a standing ovation.

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• Best Company to Work for (up to 50 employees): Energize Recruitment Solutions • Best Company to Work for (up to 250 employees): Encore Personnel Services • Best Company to Work for (more than 250 employees): Search Consultancy

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08/01/2014 11:09

Legal Update

The legislative landscape in 2014/15 Lewina Farrell, solicitor and head of Professional Services, takes us through the year ahead 2013 was an interesting year from a legislative and policy point of view. The government introduced a new category of worker – the employee shareholder. RTI was introduced in early 2013, the DBS introduced a new Update Service in June, whilst employment tribunal fees came into effect on 29 July. Right to work restrictions were imposed on Croatians when that country joined the EU in on 1 July, whilst restrictions on Bulgarians and Romanians ceased as of 31 December 2013. Here are several proposed changes still to come. TUPE – new TUPE regulations come into force in January 2014. In brief, the service provision change remains, employee liability information will now have to be provided 28 days, rather than 14 days before the transfer and the transferee (ie. the incoming supplier) will be able to make changes to a collective agreement one year after the transfer, provided there is no overall detriment to the employees, and genuine place of work redundancies will not be automatically unfair. Conduct Regulations – REC made strenuous representations to BIS that the new legislation must reﬂect the more complex recruitment market to include the range of suppliers within any supply chain. We hope to see draft legislation in early 2014, though do not expect it to come into effect until early 2015. Anti-tax avoidance measures – HMRC will bring in legislation on 6 April 2014 which will tackle (1) tax avoidance by offshore intermediaries and (2) false self-employment through onshore intermediaries (a consultation into the latter opened on 10

The legalities of parental leave are changing

December and closes on 4 February). REC has serious concerns about both proposals and will engage with HMRC in the meantime. We will keep members updated. Shared parental leave and flexible working – the government plans to introduce shared parental leave and to extend the right to request ﬂexible working to all employees in 2015. The framework for both of these proposals is set out in the Children and Families Bill, currently going through Parliament.

Shutterstock

Pensions auto-enrolment – this began in October 2012 for the largest businesses. Businesses with payrolls of 499 or less (on 1 April 2012) will enrol throughout 2014 and we expect this will include a signiﬁcant number of REC members. It is essential that members know their staging date and give sufﬁcient time to planning. (The Pensions Regulator recommends at least 12 months.) The REC delivered a number of pensions workshops in 2012 and 2013 to prepare members and we will deliver more early this year. Please see here for workshop dates and locations http://www.rec.uk.com/regions-sectors/sectors/ pensionstoolkit/WorkshopDetails Further details on the above is available from www.rec. uk.com/legal or the REC Legal Helpline (020 7009 2199).

Business development: Checks and Balances In some sectors, like education and healthcare, Disclosure and Barring Service (DBS) checks are a common and necessary part of the recruitment process. But sometimes they can take too long, frustrating efforts to ﬁll places quickly. Lancashire-based DBS specialist, Personnel Checks, offers a tailored service that can help speed up the process, ensuring that businesses can vet candidates quickly and smoothly. A free helpline has also been set up to provide REC members with support and advice in relation to any checking and vetting issues. “We help organisations make sure they have what they need

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to get the check done. One of the biggest things people talk about is time issues,” says Personnel Checks operations director, Michelle Mellor (left). “We have an online system, e-Bulk, which links directly with the DBS department – everything is encrypted obviously but it speeds up the process. Fifty-eight per cent of our checks come back within 24 hours.” For more information on the business partnership, go to the REC website www.rec.uk.com/businesspartners For more information on DBS checking, or to access DBS checks online, go to Personnel Checks’ brand new website www.personnelchecks.co.uk

www.rec.uk.com 08/01/2014 11:10

Inspiration

Behind the scenes at the Institute of Recruitment Professionals

Good chemistry This month we speak to Vicki Walker, 27, of science-based recruiter the CK Group, who won Permanent Consultant of the Year and Overall Recruiter of the Year at December’s IRP awards RM: Well done! How did you feel when you learnt that you had won? VW: I wasn’t expecting it at all. I was a bit late to the stage I was so shellshocked! RM: Why do you think you won? VW: I’ve been trying hard to really listen and build good relationships, and I think that was the main thing people noticed. One client wrote me a testimonial for the awards in which he said that I had reminded him of something he had mentioned a few months earlier that even he had forgotten about. He was impressed by that I think. RM: You’ve been described as both very professional and very friendly. Is it hard to strike a good balance? VW: When I ﬁrst started I was almost too professional. But recently I’ve mellowed a bit and tried hard to build friendly relationships. However, I still think professionalism has to be ﬁrst and foremost – learning as much as you can about the company, making sure everything is clear both to clients and candidates and so on. RM: How did you get into recruitment? VW: I did a chemistry degree and I wanted to use that somehow, but not in a lab. I felt that would be too isolated, and the people side of the job is now one of the things I enjoy most. RM: What would you be if you weren’t in recruitment? VW: I considered teaching. And I like reading, so maybe a copywriter or proofreader of some kind. RM: Tell us something about you your colleagues don’t know. VW: I’m really into swing dancing. I go away for swing dancing weekends and everything. My colleagues are laughing at me now as I’m telling you this!

Things I Know Sir Alec Reed, winner of the IRP Lifetime Achievement Award

Do one thing and do it really well I think it’s good to ride one pony. Be honest with yourself – work out what you’re good at, and then stick to it. Looking back at my own career, I think where I’ve made mistakes is when I’ve tried too hard to diversify. A generalist is a tough thing to be in the current jobs market. The computer has changed the world a lot We set up an internet company way back in 1995. We got in early. But the internet is changing everything. It’s been very difficult for head hunters because now you can contact 50,000 applicants via sites like LinkedIn so easily. Then again, it’s not very good at filtering unsuitable people out. Total immersion is key I don’t mean that you have to be a workaholic. But the jobs market is very competitive now, much more so than it used to be. You have to enjoy your job. It has to be your hobby as well as your paycheck. You can only really go the extra mile when you really enjoy it. You can have too many ideas That’s my problem anyway! I just have so many ideas going through my head all the time. I basically employ other people to tell me which are the good ones and which ones are bad – I find that really hard to do myself!

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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08/01/2014 11:11

Events and training

Call the Recruitment Business Academy, whatever the problem As your business faces the new year ahead, it’s important to know that things are running smoothly. Not only does the REC’s Recruitment Business Academy (RBA) offer a range of training, consultancy and accreditation services, delivered via talented trainers and business consultants, it’s also essentially a one-stop shop that can and should be your ﬁrst port of call, whatever it is you need help with. “We’ve been running training for a long time but three years ago, in the middle of the recession, we knew people needed a more visible way of spotting precisely where help is available,” says Anita Holbrow, director of member services at the REC. “The whole purpose of the academy is to make sure that recruiters have a single, stress free destination to go to for all their training needs.” Whether you need legal or operational training, expert business consultancy

and support, a professional audit, technological advice or staff qualiﬁcations, the RBA can help point you in the direction of the right advice. It can also offer the best experts at Anita Holbrow special member rates. “All any of our members need to do is ask to speak to their account manager, who will then do a telephone diagnostic and see what they can do to help,” says Anita. “We’re not trying to make people do things they don’t need to do, we’re just making sure we can offer help – in one place – whenever and wherever people need it.” Call 020 7009 2100 or visit www.rec. uk.com/academy-for-business for more information and for details on upcoming courses.

We offer the certificate in recruitment practice to all of our new staff as part of our commitment to staff development and to help ensure that our staff have the appropriate knowledge, skills and experience to perform well in their role. We have found that the staff undertaking the certificate always learn something new, regardless of their experience, and they are able to apply what they have learned, making the job easier and with greater success rates. Whilst the staff have found the fast track hard work and intense, they have also found it rewarding. Chris Neale, Orion Group

Recruitment Matters The official magazine of The Recruitment & 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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We got our staff to do the Cert RP after we decided we wanted everyone in sales and recruitment to be qualified. It’s something I think clients increasingly want to hear. Andrew Carr held three courses at our Sheffield office, which were followed by two and a half hours of written exams, plus coursework. Since then we’ve seen an increase in average gross profit of £2,000 per month. Plus we get great feedback from clients about improved confidence. The qualification is quite hard work! But it really does have an effect. Rhian Balshaw, Linear Recruitment

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: Ed Sexton ed.sexton@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 Woodford Litho © 2014 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.