Hiring, firing and remuneration – 2015 Trends

From
Sally Humphris

Sally Humphris

The results of The Dawson Partnership 2015 Hiring Intentions survey highlighted a marked turn-around and improvement in participant sentiment.

The 8% uplift in hiring intentions over the 2014 year is now being born out in the increased recruitment activity in a broad range of roles across the wealth management market.

The continued growth in head count numbers demonstrates that there is increased optimism amongst companies that have achieved, or exceeded their performance benchmarks over the last year. There is an inherent belief that now is the time to build on personnel infrastructure to both increase client service levels and build new business in existing and/ or new business channels.

While a proportion of new hires are opportunistic with employers targeting high quality personnel who have been dislodged from their previous employers, or have chosen to return from offshore postings, this talent pool is limited and will rapidly dry up unless there is another wave of expats returning home and/or a substantial increase redundancies.

Considering there has been a large influx of returnees in the last few years it would seem implausible that this will increase in momentum and considering that none of our respondents were looking to down size headcount, the initiation of substantial redundancy programs seem to be unlikely. Supply of quality talent is expected to dry up quickly.

Adding to the challenge for employers to secure the requisite candidates for their businesses is the reticence among candidates to move employer. Candidates are more conscious than ever that they need to protect their brand in the market place and scrutinise opportunities often in forensic detail.

Sally Humphris noted; ‘we are finding that candidates will undertake detailed due diligence on opportunities that are presented to them with increased scrutiny of the companies that include more than visiting the corporate website. More often than not, candidates will draw on their networks to make an informed decision about the company and the position itself and unless there is a compelling reason to move they will stay put’.

There can be a disconnect between the employers view of the available talent pool and reality and it may take some time for companies who view the market as awash with relevant candidates to recognise that this is not the case. To avoid spending an inordinate amount of time conducting ad hoc recruitment campaigns it is essential in this market to be more focused than ever on not only identifying who you want to recruit but ensuring candidates are carefully managed through the recruitment process. Hiring managers who don’t have strong recruitment skills and experience will increasingly find recruitment a frustrating and expensive experience and one that they’d wished they’d handed over to a professional recruiter.

There has been strong growth in hiring in investment managers that have increased funds inflow and profitability and we are seeing greater emphasis on the segmentation of positions along business channels. This is particularly evident in distribution where we are seeing a growing demand for specialists who are focused on a particular channel; the advent of the SMSF business development managers being, but one example.

Changes in technology are also having a marked impact on the distribution of investment management companies’ product offerings to the Direct (SMSF market). In particular we have seen the growth in employment opportunities in new disrupters, that is lower cost technology providers (e.g cloud based platforms and administration systems) accessing and servicing the superannuation funds member direct options and the direct SMSF market.

The risk insurance sector shows little sign of slowing. This year a number of companies will actually increase business written and grow their personnel headcount in line to meet service requirements. Advisers that are predominantly risk focused are quietly optimistic about the year ahead and product suppliers are working to enhance products and improve their services to advisers and their clients.

Advice businesses that are well managed and have established client bases along with diversified revenue streams are well placed particularly where the client base is at most moderately geared into the investment markets. While these businesses may not be looking at further recruitment activity at least until the new financial year they are not in a position where they are having to instigate redundancies and will be the first in line to recruit new staff.

Superannuation outsourcing has areas of personnel growth particularly with companies that have built significant market share over the last two to three years. There are a number of companies that have continued to recruit senior level candidates to bolster servicing and new business infrastructure and have further plans to increase headcount in the first quarter of this year.

Peter Dawson commented; ‘while the war for talent is more subdued than it has been in the past, companies are still sharpening their pencils offering competitive market remuneration to secure the high achievers for their businesses. There is however significant emphasis placed on making sure that the decision to hire the right candidate is supported with a rigorous approach to the recruitment process’.

Remuneration remains a pivotal issue in recruitment and while there has been little movement in salaries over the last year, companies continue to sweeten short and long term incentives. We will be able to provide you with further detail on remuneration trends when we release our annual Remuneration Survey in July.

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