If we had a pound for every time we’d read about it being a candidate’s market, well we’d have a lot of pounds.
We’ve all read the articles, heard the news and felt the impact of the lack of great candidates right now. Which means it’s even more important than ever to understand what’s motivating employees, what are they looking for, what do they actually want from a job and an employer.
To find out, Ambition surveyed people working in professional services firms within Finance & Accounting and Business Development, Marketing & Communications.
The results weren’t a surprise. When asked to list their top 3 priorities salary, remote working and diversity and inclusion topped the list.
The state of the market
Hiring reached unprecedented levels in 2021 and 2022 and whilst the market cooled at the beginning of this year, the overall sentiment for the rest of 2023 is positive.
58% of hiring managers from professional services firms said that they expect hiring levels to stay the same in 2023, while 8% expect hiring levels to increase.
This clearly demonstrates that professional services firms are feeling positive about recruitment and are still looking to grow their teams, and their firms, despite the challenging environment.
Money, money, money
So what do firms need to do to attract the best candidates in this market?
According to our results, the top reason for Finance & Accounting professionals to move roles was to get a better salary/benefits package.
Salary was also near the top of the list for BD & Marketing employees.
For firms that are serious about attracting top talent then it’s clear that salary and monetary benefits are front of mind for employees and candidates.
When you consider that 44% of Legal Finance candidates and 49% of Business Development & Marketing employees received a salary increase of more than 15% when moving jobs externally it’s not surprising candidates are on the move, particularly with the current cost of living crisis.
With the swing towards remote and flexible working, it would be a fair assumption that where people work might have more impact than the salary they receive every month.
But 71% of Legal Finance employees said they wouldn’t be willing to consider roles with a lower salary in exchange for fully remote working.
This rose to 80% of BD & Marketing professionals.
Demonstrating that when it comes to attraction strategies, firms need to first and foremost look at their salary/benefits package to ensure it’s as competitive as possible.
Impact on retention
The flip side of competitive packages is that more often than not, candidates are getting higher salary increases by moving to other firms, rather than staying where they are. This increases staff turnover and pushes hiring costs even higher, fuelling a competitive market.
It’s important for firms to look internally at packages, salary and benefits if they’re reviewing their offering for new hires to keep current employees engaged where they are.
Not all firms will be able to increase packages, whether for existing or new hires. It then becomes essential to develop a flexible working culture.
Flexible working, culture and clear career progression opportunities are all great opportunities to keep employees motivated, challenged and engaged.
For firms who are serious about retaining staff without increasing pay across the board, this is where they need to start if they stand a chance of keeping their best team members.
Home or office
As the pandemic becomes a memory rather than a daily reality, we’re seeing a shift in employers asking people to come into the office for more days.
Yet our results show that employees don’t want to come into the office more, most prefer 2 days in and 3 days at home.
73% of the hiring managers we spoke to said that employees are now required to work in the office 3 days a week. But when it comes to employee expectations the majority said they only wanted to be in the office 2 days a week.
Only 11% of Legal Finance professionals want to work 3 days in the office and that only rises marginally to 14% for BD & Marketing employees.
Flexible working is an influential factor in candidates' decisions. 86% of firms surveyed offer flexible working, but the balance of home vs office could become an area of contention and something that firms will need to consider their stance on if they want to attract or retain employees.
The proof is in the action
Employees are looking at firms in a different way. They’re looking at their values, their culture and their commitment to follow through, not just to make empty promises. For candidates, one area that’s particularly important is diversity and inclusion.
Diversity and inclusion isn’t a new initiative, but what is new is the level of importance being placed on taking action.
Candidates and employees want transparency and evidence around a firm's actions and commitments.
From our survey we found that 59% of BD & Marketing employees and 39% of Legal Finance employees have said they would review a firm’s diversity and inclusion policy when considering joining a new firm.
But firms need to demonstrate a commitment that goes beyond a piece of paper. They need to show the tangible steps they’re taking, how it’s embedded in the firm’s culture and what success looks like for them.
What’s the plan now?
What actions are hiring managers already taking? 79% plan to increase salaries by 3-5% this year. But when that’s compared with the up to 15% jump the majority of candidates are making when moving jobs, you have to query whether that’s enough.
Given the responses from employees stating that salary is the most important factor, more firms may need to look at bigger salary increases if they are to remain competitive for both recruitment and retention.
For other hiring managers, the answer is to look outside the current legal business services market and recruit from outside the sector. Or to consider hiring fully remote workers so that location isn’t a limiting factor.
What’s clear is the recruitment industry has had to adapt and change so much over the last few years that it now feels we’re getting to a point of stability once again.
That’s not to say it’s the same as before. The market, and candidates' expectations have changed and it’s unlikely to revert back to pre-March 2020.
Salaries, flexible working and diversity and inclusion are all topics that firms need to address if they want to continue to recruit and retain the best talent in their sectors.
Based on our results, we don’t see that changing and, if anything, with the market positioned in the candidate’s favour right now - those three factors will only gain more importance and become more entrenched in candidate’s expectations.
Download a copy of the full market trends surveys here or feel free to message me if you have any questions.
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