Recruiters 'off a cliff'; 'schizophrenia' over senior roles v mid and junior ranks
Several recruitment firms have already entered voluntary administration as the jobs market "falls off a cliff". Others working further up the executive food chain, though, have ongoing briefs. If the senior ranks are ring-fenced, what will industry culture look like when COVID-19 passes?
What you need to know:
- Recruitment industry is on its knees in the wake of COVID hitting full force
- LinkedIn to take a hit as recruiters bow out of Talent Solutions
- C-suite roles are still on the table while mid to junior positions put on hold
- Some recruitment firms specialising in agencies and media have entered administration
- The industry is in a "firing over hiring" mindset - protecting management over staff, say some recruiters
- They say this risks serious impact on workplace culture once the market bounces back
Top jobs hold, remainder on hold
Media and advertising recruitment firms have come to a screaming standstill. According to Brenton Moore, founder of long-standing industry firm MAARS, this is the worst he's seen it.
Moore had 15 assignments on the go in early March for commercial or content roles in TV, radio, outdoor, publishing, and digital and a few media agency roles for planner/buyers and digital account managers. But by mid-March, all those assignments were put on hold or simply cancelled, representing about $250K in billings for MAARS.
"We only make money when the market is hiring not firing," he says. "With current advertising schedules being pulled or cancelled, media agencies and media owner revenues have been dramatically impacted nearly overnight.
"Various businesses have had to act quickly in terms of downsizing sales teams or agency teams."
Conversely, Anthony Hourigan, CEO of Hourigan International, says C-suite roles such as CEO, CMO, CFO and Chairman remain open.
Hourigan says while this may change in six months, dependent on how lockdown measures evolve, the majority of briefs he has received are still ongoing and salaries remain unchanged.
"Overall, the job market does look like it has a case of schizophrenia and recruitment is at the stormfront of that," Hourigan says. "However, when it comes to top executive roles, we are going to see a demand for greater leadership. We've already seen companies increase interest in those with experience in navigating brands through difficult times."
Hourigan says the fallout from this will be a need for more entrepreneurial leadership qualities as opposed to what he describes a "high-end technocrats".
"There is going to be a huge consumer hangover once this is all done so those in top roles who have worked in calm waters are about to see tides change. This is going to be more about steadying the ship. It's about who can bring a creative, critical and radical approach to marketing budgets, media mixes and finance, so don't expect to see the same faces leading businesses out of these extraordinarily tough times."
Culture Clash
Esther Clerehan, a long-time headhunter in the creative industry, says the focus for many should be on retaining staff over firing to protect the c-suite.
She says the CEO and top level executives should begin by taking greater salary cuts to protect their lowest paid employees.
"This is not like managing numbers after a client loss, where the job losses are balanced by other agencies somewhere hiring. Every agency who lets staff go during this crisis is sending that person to Centrelink."
Clerehan says those taking this approach will affect internal cultures post-COVID. "People will remember the agencies that at least tried to do the right thing by staff before resorting to job cuts," she says.
"There will be a war on talent and the agencies who cut deeply will find it harder to find people quickly when the recovery begins. Not only will they be caught short, they will have some reputational damage to overcome. The market finds its level quickly, for better or worse, and even though not all jobs and levels will bounce back, where there is demand, the money will follow so it's important for agencies to retain their good culture and image."
Moore says there have already been examples of agencies recognising the importance of viewing recruitment and employement as a long-term issues rather than focusing solely on the immediate impacts.
"A good example is a media agency in Melbourne striking an agreement with all staff, seeing them take unpaid leave for the next two months. The deal is if they come back in month three, they can all return to their seats - paid," Moore says.
He believes it is vital that the industry take this approach and focus as a positive recruitment and agency culture will ensure businesses bounce back faster.
How does recruitment fair?
At least three industry recruitment firms have already fallen into administration, according to industry players who did not want to be named, while others have begun to shutter at rapid rates.
Those in healthcare, banking, telecommunications, mining, grocery and mining are managing to survive but some say it's bleak for 80% of the sector.
The cost-cutting underway is already hitting LinkedIn where recruiters say they're cancelling licenses for the Link Talent Solutions (LTS) division.
LTS provides recruiters with access to LinkedIn's suite of products designed to help find and acquire talent on the platform.
At $10,000 per license, per individual, industry insiders from a variety of recruitment agencies have told Mi3 they have or plan to cancel their subscriptions to the service. LinkedIn was approached for a perspective but did not want to respond.
