A hiring freeze has taken hold over the city of London, with companies suspending or canceling expansion plans as the coronavirus epidemic continues, although searches for management positions are underway. continue.
“The number of businesses we have seen declining in the past three to four weeks has been astounding,” said Philip Thompson, director of Thompson Taylor, who works in analyst and director positions in banks, consulting companies and investment funds. . “I expected it, but not necessarily so quickly. “
He added that the change was particularly noticeable in private equity given the slowdown in trading.
Hays, one of the UK’s largest recruiters, warned last Thursday that the epidemic had caused a “very significant deceleration” in its activities, with operating profit for the year until June 2020 likely to be “significantly lower” than analysts’ expectations of £ 190 million.
Tiger Recruitment, which focuses on the personal assistant and secretarial roles, said demand for the positions has dropped sharply. Revenues from temporary workers fell 30% in the last week of March compared to the first, while job seeker registrations fell by almost half and requests for permanent recruitments from businesses decreased 90% over the same period. “Now that executives are no longer traveling, the demands are much lower,” said David Morel, chief executive officer.
HSBC said last month that it was freezing external hires, except for a small number of positions deemed critical or for those who already had written offers. The bank also has to delay many of the recently announced layoffs as part of a restructuring program.
This change left recruiting companies struggling to adapt to the downturn in business. Hays raised £ 200 million to protect his company from falling costs while rival recruiter Robert Walters unveiled plans to cut costs and suspend his dividend.
Meanwhile, Armstrong International, a headhunter for financial services, has adjusted its fee structure, with lower upfront costs to encourage business. Iona Prideaux, head of business development at Armstrong, said some research had been suspended, but not canceled.
Unlike research companies, recruiting companies do not charge an initial fee, but receive a commission when successful internships begin.
This has made them particularly vulnerable as they have had to lose their future jobs and the income from job offers made months ago, said Heather McGregor, Executive Dean of Edinburgh Business School and non-executive president of the firm researcher Taylor Bennett.
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Thompson expressed concern about the prospect. “We have candidates who have accepted offers, with start dates reserved in April and May. Will they go ahead? “
However, headhunter activity focused on the highest executive positions has not stagnated to the same degree, according to those in the industry.
” [With] very senior strategic hiring is not a short-term thing, “said McGregor. “You could slow down the search, but the chances that you suddenly decide to end two or three weeks of the crisis will make it all small enough.” “
A prolonged movement lock could change this. “If it lasts three months, it won’t have a massive impact,” said Rupert Mathieu, partner at Sainty, Hird & Partners. “The only thing that will stop research altogether is if it goes on for nine months or a year – then we all have a bigger problem. “
Others have warned that not being able to hold face-to-face meetings could have detrimental consequences. “In leadership positions, they could never make a decision without meeting someone,” said Tanya Lutyens, founder of the executive search firm Lutyens Advisory.