The results of our quarterly review of the accounting and finance sector are in and they paint a picture of a sector on the rise as we move through the second half of 2015 and into 2016.
I feel safe in saying that confidence is coursing through the industry; more than two-thirds of our clients (67.5 per cent) expect business growth in 2015, with one in five (21.9 per cent) believing the year is already surpassing their expectations.
This confidence is not misplaced. Of the 43 per cent that are increasing their overall workforce during the first half of 2015, more thna three-quarters said that their largest increase was in permanent hires. More than half (52.8 per cent) cited improved market conditions as a reason for this increase.
With strength in the permanent hiring market always a sign of long-term business confidence and more than four in five senior managers expect to maintain or even increase this trend during the second half of 2015, we have good reason to be positive.
That is not to say that it has been plain sailing all year and we certainly don’t want to sound complacent. Business thrives on stability, and accounting and finance is no exception. The General Election in May, and the prospect of political instability that it threatened, meant that the industry briefly slowed down, particularly in the South of England as businesses across the industry collectively held their breath as the British public went to the polls.
Businesses in London were the least confident area during our survey with 59 per cent of senior managers expecting growth in 2015 (this is compared to 75 per cent in the Midlands).
Temporary placements increased at the start of the year in response to this short term view but confidence has returned since the result was announced. All signs suggest that this phenomenon will be a temporary one, which business won’t have to consider again for another five years.
There is, however, an elephant in the room that all our clients are sure to have to address sooner or later: the lack of available, quality candidates.
Almost half of our clients (48 per cent) thought the lack of quality candidates would be a challenge when recruiting during the second half of 2015, and one in four also cited a significant skills gap.
Long-term solutions don’t seem to be the answer. When quizzed how they would deal with these skills shortages, more than a third of senior managers across the UK responded that they would bring in non-permanent resources to provide cover. As an industry, we need to think about how to deal with this skills shortage in the long-term, rather than relying on short-term, quick fixes.
That said, the skills shortage is good news for some people, specifically those who possess the skills that recruiters are looking for, with FP&A and technical accounting skills at the forefront of demand.
Competition for these candidates has become increasingly fierce as the recruitment market becomes increasingly candidate-led. Almost a third of clients are worried about high salary expectations in the market this year. Increased competition appears to be particularly front of mind for those in the South East. Those who possess the necessary skills are therefore seeing a strong increase in their market rate.
So what does our research tell us? It is clear that businesses looking to recruit have to change their behaviour in order to deal with this new market phenomenon, or risk losing out. It is encouraging to see the growth in the accounting and finance recruitment market, fuelled by record numbers of people in work and stretching across every region of the UK.
But I would advise recruiters to avoid complacency, and adapt their recruitment processes to recognise two key points: they are attempting to recruit from a limited pool, and their offer might not be the only one on the table.