Recruitment Matters Issue 23 March 2014
Trade Association of the Year
What’s inside The Intelligence 2 -3 and REC Talk The skills gap, the REC’s specialist sector groups and the Good Recruitment Campaign The REC’s ‘Room at the top’ survey on women leaders and the role of executive search
Where are all the women, asks the REC More women are in work than ever before, as official figures from the Office for National Statistics show a record-breaking 14 million now have jobs. However, this has also coincided with an increase in the gender pay gap, as median wages for women fell. Why should we care? Not just because this inequality seems unfair, but because evidence from new Recruitment & Employment Confederation (REC) research on gender diversity shows that more diverse teams make better business decisions. It is in everyone’s interest – the client’s, the candidate’s and the recruiter’s – to ensure that there are more women in the workplace from recent graduates to the boardroom. In Lord Davies’ report, ‘Women on boards’, released in 2011, a target was set for a minimum of 25% of female representation by 2015 in FTSE 100 boards. This figure now stands at 20.4%. Nonetheless, positive changes in the makeup of the top teams are increasingly evident. Appointments such as Inga Beale, the CEO of Lloyd’s of London insurance, the first woman in the company’s 300-year history, and Lloyd’s 2020 pledge to have 40% female representation
at all levels of management, signals that companies are trying to redress the balance. The REC report is based on interviews with 17 executive search firms working in various sectors and including interviewees who place board members within FTSE 100 companies. It shows that executive search firms are playing a critical role in getting more women into senior positions and considers what more they could do. Such firms feature significantly in the appointment process. The Davies report notes that 73% of FTSE 100 and 66% of FTSE 250 companies stated that they use executive search firms. So what can you do? In summary, the report makes several recommendations such as: executive search firms should publish measurable data (such as data and statistics on the proportion of women on long and shortlists, percentage of female appointments and placements by salary band); develop a compendium of good practice; and consider making public the gender make-up of their own board and senior teams. For full details visit www.rec.uk.com
Diversity – 4-5 gender, age, BME, disability … and how recruiters can help
6Business Matters
The Compliance Test, and good software opportunities with with Microdec
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Institute of Recruitment Professionals We speak to Dynamite Recruitment’s Matt Fox and Right People’s Bruce Russell
Best Events and Training 8 The Business Brains II – get tips for your business from the experts
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Leading the Industry
the intelligence Fig 1: Turnover growth 2012/13
Bridging the skills gap
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There are plenty of roles that need filling, so why don’t women fill them? Nina Mguni investigates 16 to 64 were in the workplace. But are employers making use of this supply of women? The Office for National Statistics (ONS) data suggests that women are more likely to be concentrated in professions with lower rates of pay. There are a higher proportion of female graduates in lower-skilled roles (eg. teaching assistants, home carers), with 27% of women working at this skill level compared to just 13% of men. The ONS states: ‘More women than men were employed in lower middle-skilled jobs, despite employed female graduates tending to achieve just as strong degree results.’ In particular sectors, for instance engineering, women are noticeably absent. There are a number of initiatives that have been established to redress the gender balance within engineering. Within the recruitment industry, recruiters like Sagent Solutions actively promote women in engineering. With only 7% of all engineers who are women, this is no easy feat. However, it would appear that if recruiters like Sagent Solutions get this right, investing time and energy in drawing women into sectors with skill shortages will eventually lead to high returns. Nina Mguni is senior researcher, REC
Skill level of job High
Upper middle
Lower middle
Low
Men 53%
31%
13%
4%
27%
3%
GRADUATES 49%
Women
21%
While the percentage of male and female graduates in high skill jobs was fairly similar, the percentage employed in upper middle skill jobs was not
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20 15 10 5 %
In January 2014, the UK Commission for Employment and Skills (UKCES) published its findings from the employer skills survey. The report identifies some valuable insight into the skill deficiencies based on data from 91,000 employers across different sectors. Within a context of the improved economic situation and with vacancies back to pre-recession levels, we could be accused of taking a ‘glass half empty’ attitude. However, skills shortages are problematic. The UKCES employer skills survey states that ‘economic growth and recovery may be constrained by skill shortages as the labour market responds to employer requirements’. Skill shortage vacancies account for one in five of all vacancies. In 2011, this was 91,400 but in 2013 this figure had grown to 146,200. The average density of skill shortage vacancies for skilled trade occupations and professional roles are especially acute. Professional roles in manufacturing are particularly persistent. Within this context, the absence of female employees in certain sectors seems surprising – this would appear to be an obvious talent pool to draw on. In the last 40 years, more women have entered the workplace. As of April to June 2013, 67% of women aged
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■ Median ■ Lower quartile ■ Upper quartile
0 -5
-10 -15 -20 -25 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Dec 12 13
Turning over a new leaf Throughout 2013 Recruitment Industry Benchmarking (RIB) has reported a generally improving picture for recruiters, and our members now have their full reports showing year-end results for 2013. The graph above shows ‘turnover growth’ compared to the previous year. A graph you will have seen in previous months but this month not only have we updated it to show year-end 2013 figures, we have also shown the ‘spread’ that different recruiters are reporting by showing not just the median RIB figure but also the upper and lower quartiles. The first thing to notice is the general trend from early 2012 to December 2014 of improving turnover growth for all three measurements. This is obviously very encouraging, especially when combined with improving net profit margins, as reported last month. However, what the graph also shows is the very different experience that a number of recruiters are having with the upper quartile finishing 2013 on a turnover growth figure of over 17%, compared to the lower quartile showing a decline of 3%. The median figure was still showing a healthy improvement of over 6%. There are a number of reasons for this spread, including sector etc, but what is positive is that when looking at net profit margins, the upper quartile (6%), median (3%) and even the lower quartile (0.5%) are all reporting positive figures. So 2013 was generally a positive year for most and although 2014 will no doubt have its challenges it should also provide more opportunities. It will, however, continue to be a very competitive market, and management will have to use all the tools at their disposal to optimise performance – knowledge is power. • Chris Ansell is chief financial officer at Recruitment Industry Benchmarking (RIB) www.ribindex.com
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Leading the Industry
Winds of change Tom Hadley, director of Policy & Professional Services, looks at specialist sector groups The REC’s aim is always to ensure that, wherever possible, the winds of change create new opportunities for REC members rather than unhelpful turbulence. Nowhere is the need to be ahead of the game more urgent than across our specialist sector groups: 1. Evolving skills needs This is an ongoing priority for high-end groups like REC Technology. The aim is to use our ongoing research to identify high demand roles for the IT sector – these currently include C++, PHP and Java specialists as well as developers, project managers and technical consultants. Another group with manically evolving skills needs is Marketing, Media, Comms & Creative industries (MMC). PR and comms roles reflect broad changes to the media and corporate communication landscape. The overall role of marketing functions within organisations is also being transformed. 2. New projects mean new opportunities The work of REC Engineering has focused on what high-profile projects such as HS2, nuclear new-builds and fracking will entail in terms of future hiring needs. The latest meeting was an opportunity to exchange views on this with other organisations such as the Greater Manchester Chamber of Commerce (GMCC), the Engineering Employers Federation (EEF) and STEMNET UK. 3. Changing structures in education and healthcare The recent REC Education meeting focused on the changing schools landscape and curriculum, and the role that technology will play in the classrooms of the future. The introduction of performance related pay for teachers is another significant change. Ensuring that the safeguarding agenda remains paramount is a major priority and we have continued to actively promote REC Audited Education. Priorities for REC Health & Social Care include new revalidation measures for nurses, new NHS frameworks and a renewed focus on standards in care and social work. 4. Changing values and business priorities The ‘Women on Boards’ agenda continues to build momentum and means that employers are under pressure to show that progress is being made. The priority for the REC’s Association of Executive Recruiters (AER) is to continue ramping up the contribution of executive recruiters in delivering better gender diversity in senior positions. Our recent roundtable on this issue coincided with International Women’s Day and launched a new report on how executive search firms are changing the way they identify talent and manage the selection process.
The View It’s clear from all the jobs data available that skill and talent shortages are becoming more pronounced. As demand returns to the economy, business confidence improves and businesses start to invest, this lack of critical capability may well hinder the UK’s economic growth. Recruiters have a huge role to play in helping employers be more creative when looking for scarce resource. We recently published a great piece of research about the proactive role executive search is already playing in attracting women to board positions, where they are greatly under-represented. This research highlighted the critically important role that recruiters play in challenging employers’ assumptions and encouraging them to look at different pools of potential talent. Our job at the REC is to educate policy makers about the importance of having great intermediaries who help people progress. The recruitment industry helps people develop their careers – we are the champions of social mobility. In the next few weeks we are launching our Good Recruitment Campaign, which will enshrine only using effective and compliant agencies. We have been working with others including the CBI, CIPD and FSB to develop the campaign’s charter that sets out what good recruitment looks like. We will then ask organisations to sign up to this aspirational set of recruiting principals. We want all REC members to embrace this important work and promote the charter to their clients. Together we can raise the profile of good recruitment right across the whole of the UK. This will involve us educating HR, procurement, talent and in-house resourcers about why they should only use recruiters who are committed to standards and compliance, something I know is as important to you as it is to us. • You can follow Kevin on Twitter www.twitter.com/@
• You can follow Tom on Twitter www.twitter.com/@hadleyscomment
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kevingreenrec
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The Big Talking Point
Mind the Gap I
t is easy for discussions about diversity in the workplace to become a bit of a blame game. One issue is the pay gap that exists between men and women. Even though there are more women in work than ever before in the UK, the gender pay gap has risen from £89 to £97 a week over the last year according to the Office for national statistics. Other issues include the lack of ethnic minority employees in certain industries and the difficulties faced by certain age groups, such as todays graduates in an over saturated market. With all of the above issues its common for people to lay the blame for any ongoing imbalance at the door of the employer or the government. Why is there not more legislation to protect and include certain minority groups? Why do certain companies not strive harder for wider talent pools, both at the recruitment stage and in terms of retention? For the recruiter, this situation presents unique challenges but also opportunities. As recent research published by the REC demonstrates (see page 1 for more details), evidence shows that diverse teams make better business decisions, especially at the executive search level, where specific skill sets are often underrepresented and in high demand. And of course, for recruiters, the wider the pool, the better the candidates, so it is in the interests of the recruiter to make the business case for diversity at all levels very clear to clients. Sarah Gordon, associate director at The Sammons Group and chair of the REC’s Diversity and Inclusion Sarah Gordon Forum (visit the
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Policy and Campaigns section at www. rec.uk.com for details), observes that recruiters have an important part to play in transforming these pointless blame games into more efficient recruitment streams and more diverse workforces. “The driving down of client margins has obviously made it more difficult for recruiters to encourage clients to make their candidate requirements more diverse and to put in place infrastructures and branding that improve diverse retention,” she says. “But there is an increasing need for certain skills in certain industries too, so diversity is actually becoming an economic necessity. It is important that recruiters do as much as they can to develop strong and trusting relationships with their clients so that they are in a position to be honest about diversity shortcomings when it comes to the candidate requests or company profile.” Below, we offer some thoughts and tips on several specific diversity issues.
Gender This is perhaps the area of diversity that hits the mainstream headlines the most. Things are certainly looking up. In 2013 there were 13 million women in the workplace, representing 67% of women aged 16 to 64 years old. In 1971, this figure stood at 53%, according to the REC. In some traditionally male industries, women have become a dominant force, even overtaking men. In 2013, 51% of candidates registering with Randstad Financial and Professional were women, which the recruiter believes is the result of an increase in the supply of female talent. And the UK is doing better than its neighbours too. In the UK, 34.8% of women are managers, directors and
SuperStock
There are plenty of sectors where diversity can be improved. RM editor Francesca Steele looks at how recruiters can help
senior officials, slightly higher than the EU average of 33%. But there is plenty more to be done. Anne Richards, chief investment officer at Aberdeen Anne Richards Asset Management, says that although understanding of gender bias is better in the workplace, the obstacles to full inclusion are more subtle than they once were. “Interestingly, if you look at the statistics, gender bias hardly exists at graduate level. But it also starts long before women have children. Women still get signals that prevent them from applying for certain positions. For example, men are often promoted by what’s known as an ‘anointing process’.
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Women don’t get that same tap on the shoulder approach, often because people simply assume they don’t want to go for certain promotions (moving abroad, say, if they have children) or because the employers just don’t know them as well.” It’s important for recruiters, suggests Richards, to encourage clients to embrace changes that attract more women – such as getting involved in formal sponsorship programmes that allow women to feel they are forging significant relationships in the same way that men often do at the golf club or client nights out.
employees are often the hardest to reach,” says Gamiel Yafai, who has been head of diversity practices for two large recruitment communications agencies in the UK Gamiel Yafai and now runs a diversity consultancy. “There is a smaller pool to begin with. Then you take the fact that many companies advertise on websites rather than in newspapers and so on, and it means that those small pools just don’t come across particular companies in newspapers and traditional advertising methods anymore. It means certain communities, and potentially good candidates, can be entirely cut off from the recruitment process.” In addition, adds Yafai, if these communities do come across company websites and job adverts they can be put off by bad branding (“only white people on the website, that sort of thing”) and by preconceptions about the industry. “Recruiters need to make sure that clients promote themselves as an inclusive organisation. They can give candidates more information about the interview process, or even run workshops to help candidates understand more about the job.” Clients and recruiters can reach BME candidates by engaging with influential people in communities, such as mosques, African Caribbean Centres, Asian women’s centres and so on. “It’s about asking questions within communities, like ‘do you know about apprenticeship schemes?’ BME inclusion is about challenging preconceptions on the side of the candidate more than the client. Although, of course, the clients have to push that themselves.”
Youth Black and minority ethnic (BME) Reports consistently show that BME applicants are often discriminated against in many industries, including the NHS and the police force. “Potential BME
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Age might not be a minority group in the same way as the others included here, but candidates are often discriminated against because of their age, say recruiters, especially in hard economic times. “The main issue for young people at the
moment is the level of expertise that they can bring to the role,” says Sadie Besley, operations manager at Randstad Student Support & Worker Support. ”Employers Sadie Besley perceive the workplace as being overly saturated with graduates at the moment. So they are expecting young people to come to roles with more skills than they once did. The reality is that graduates need to bolster their experience before they even get to the recruitment stage.” It is sensible then for recruiters – and universities, for whom getting more graduates into jobs is obviously crucial to their reputation – to encourage undergraduates to do work experience and paid internships wherever they can. On the other hand, adds Besley, it’s also important to help clients realise that young people can be good value even if they lack a few years of experience in the workplace compared with someone else. “They arrive cheaper than someone with more years of experience – and provided they can learn, they are often more loyal and committed to the company that trained them.”
Disability There are three main types of disability that present difficulties in the workplace, says Besley, whose role also covers managing support for disabled employees: physical handicaps, dyslexia and dyspraxia, and mental health difficulties. “Although the last of these is perhaps what people think of last when they think of employee disability, it is actually the most common and is often overlooked, in large part because of the stigma attached to it. There are some practical elements to tackling disability in the workplace, of course, but one of the first things employers can do – and recruiters can encourage them – is to ensure the work environment feels like a place that will be sympathetic to such issues.”
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Legal Update
The REC Compliance Test It’s an opportunity not an exam, says Angie Nicolls, the REC’s head of compliance and customer services The REC introduced the online compliance test in 2012 for new members and 2013 for existing members. The test is very straightforward; it’s not an exam and has been designed to demonstrate that, as a business, you know what is required to be compliant with UK recruitment legislation and the REC Code of Practice. New members have six months to take the test from entry (to become full REC members) and existing members have two years. All members have three attempts to take and pass the test. There are different questions for temporary and permanent agencies or a combination of questions if you do both, and the number of questions varies between 29 and 57 depending on your business type. What is your deadline for doing the test? If you are an existing member you must pass the test by the end of 2014 to renew your membership for next year. The REC has introduced staging dates to help ensure that we are available to answer any queries that you have and these have been emailed out to all REC members. If you are unsure of yours, contact the compliance team on 020 7009 2100.
Stats and facts – it’s really not that bad! • On average it takes 45 minutes to complete the test • It can be done over a 24-hour period, so you can stop and start again • It’s made up of multiple choice questions • The pass mark is 75% • The average pass mark is 85% What support is available to help you through the compliance process? • The REC has an extensive Legal Guide https://www.rec.uk.com/legalresources that includes factsheets, model documents and guidance on all key areas • There is a trial test that gives you a feel for the content and format of questions, and you can take this as many times as you want • There are guidance documents available on the test site • There is a team of expert compliance executives who are on hand to give you every assistance. If you would like to talk to a member of the team before you take the test please call 020 7009 2100 • Monthly compliance workshops run by
Angie Nicholls, REC head of compliance and customer services our experts who will provide you with all the information you need to pass the test. Bring a laptop with you to the workshop so that you can take the test at the end; so far 100% have passed the test following this route. You can book a place on a compliance workshop online https://www.rec.uk.com/businesssupport/events/complianceworkshops or call 020 7009 2100 For further information about the compliance test, please go to https:// www.rec.uk.com/membership/ compliance/rec-compliance-test or call 020 7009 2100.
Business development: Keeping pace Every recruiter knows how important the right computer software can be to keeping up with such a fast-paced industry and jobs market. And there are a lot of options out there, which is why Microdec, one of the REC’s newest business partners, is particularly proud that one its very first users is a loyal client 30 years later. “There are lots of applications out there in the markletplace,” says Mark Bowyer (above), business development and marketing manager at Microdec, “but I think we are especially nimble, as well as having decades of experience.” Microdec offers two main products, Profile EPM and Profile
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RPM, both of which have a dashboard of ‘smart-feeds’, keeping recruiters informed of interviews, when to follow up with feedback and how they are doing against their targets and so on. EPM is more basic, designed for new companies and people setting up on them and RPM offers more complex options. The beauty, says Bowyer, is that companies can switch from one programme to the other as they grow. “Our product allows businesses to grow and change with the times – something that is, of course, especially really important in the current economic climate.” Go to www.microdec-profile.com for more details.
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Inspiration
Behind the scenes at the Institute of Recruitment Professionals
Dynamite delivery Matt Fox, managing director at Dynamite Recruitment Solutions, which won Best Client and Candidate Experience at the IRP Awards Congratulations! What do you think it was about Dynamite’s approach that helped you win? Hopefully it was the quality of the team that forms Dynamite and the talent of the individuals. Two of our clients wrote some very complimentary testimonials, focusing in particular on Jodie Rafferty, our associate director. That’s what made it so nice really, that it was the clients themselves who wrote the testimonials. What did they say? Essentially that our service was second to none. And that the people were passionate and honest. There were specific incidences where I think they felt we’d done more than some recruitment firms would have done. And Jodie manages relationships with a lot of our key clients, so she was integral to that service. Any particular examples? Yes, we did things like setting up car sharing schemes for candidates and employees, to make sure they arrived on time. We helped clients improve their green credentials. We went on site to deliver instructions to the temporary staff we had provided to ensure they knew the basics of the company and what they were doing, which helped to reduce training times for the client. Things like that. You mentioned honesty. How important is that? So important. We’re a small team – there are 12 of us – and we are always honest about who we are and what we try to achieve. Are we an agency who will try to jam a round peg into a square hole? Absolutely not. We’re much more about suitability than just filling a role. We have been known to cancel interviews at the last minute if we start to feel the interviewee just isn’t right and will reflect on us badly. But of course we will always then try to find someone who is right for that role. How did you decide to set up your own business? I’ve been in recruitment for about 13 years and I set up Dynamite two and a half years ago now. People said you must be mad to be setting up in such a tricky economic climate. I suppose it was a big risk but I never saw it like that, because I always saw that there was a place for a recruitment firm that would go out of its way to be better than its competitors.
Things I Know Bruce Russell, director of Right People, gives us his career tips
Core values are important I set up Right People in Aberdeen with Alex McLeod six years ago, in part because we felt like recruitment was moving away from its core values. Too many people were trying to take short cuts, such as using e-mail to communicate with candidates and failing to actually meet them. But it is still so important to meet people, to build relationships. It’s better to have the right choice than lots of choice We provide a boutique service in the sense that we work very closely with both our clients and candidates so that we don’t have to send a lot of CV’s to make a placement. We feel we are better placed to find the right, more precisely suited candidates to the roles in question. It’s not about quantity, but quality. The candidate’s needs are as important as the client’s We always try to understand what the candidates current and future goals are, as well as which clients may suit them culturally because that way we can ensure we are finding the right role for them. That in turn is useful for the client because it can boost retention and a better work environment. Technology can be good and bad for recruitment Improved technology has definitely brought benefits. For example, it’s easier to communicate with candidates and clients more quickly. But it does also allow for shortcuts to be made. Meeting people is as important today as it has ever been. I placed someone last year who I had not had a chance to meet before they arrived in Aberdeen for interview, so I picked them up from the airport and drove them to the interview myself so I could meet them. When you do things like that you become a better recruiter, whether or not that person gets the job, because you understand the people involved better.
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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Events and training
The brains behind the business Business Brains, two world leaders, one REC event, Manchester and London April 2014 The REC is hitting the road, as it goes on tour for Business Brains II with some top UK business talent, who will share their business knowledge to help you grow and develop your recruitment business. Business Brains II: Two World Leaders in Recruitment will hold one event in both Manchester and London in April 2014. There you will be able to join two international recruitment experts for a day set to be packed with the best business advice including: • How to future proof and grow your recruitment business • How to enhance the value you provide to clients and candidates • Learn the secrets of today’s winners • Explore different ways to improve your bottom line You’ll come away from these one day events with great ideas, hints and tips focused on future proofing your business and bringing out the best in you and your staff to grow revenue and profit.
When and Where • Thursday 3 April 2014 – Manchester • Friday 4 April 2014 – London Timings: • Registration: 8:30am • Start: 9.15am • Close: 17:30 Price: • REC & IRP Member Price: £299 + vat • Non-Member Price: £499 + vat As with other similar events we offer packages for bookings of 3 or more, please contact 020 7009 2100 for more information.
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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The Business Brains Greg Savage: Remake. Remodel. Future Proof Recruitment Greg has over 30 years of recruitment industry experience, having run and owned recruitment companies, and consulted around the globe. He is on the board of 10 recruitment companies, a shareholder in several and speaks at recruitment conferences all over the world. He has a compelling insight to how a recruitment company should operate in an ever-changing market, and in this series for the REC he shares how recruiters need to adapt fast to survive and thrive. Mary B Lucas: Bring out the Best! Your Key to Success in the People Business Mary has more than 30 years’ staffing industry experience, beginning her career as a consultant and rising to her current executive position as chief resource officer of Staffmark, one of the USA’s largest and most successful staffing companies, which has its headquarters in Cincinnati, Ohio. She is responsible for leading the company’s sales, marketing, operations, service delivery, and talent acquisition support teams. Kevin Green, REC CEO Kevin is an ex-HR director and entrepreneur. Having run his own successful HR consultancy for over 12 years, including an MBO, he will talk from a customer’s point of view. Kevin will provide a short update and outline what makes recruiters successful in the UK today.
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.
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