Recruiting and Recession - Is It a Buyers Market? - February 2009

The compiled results from the fourth annual survey of the UK project management market conducted by Arras People confirmed what many of us already thought we knew; the credit crunch and economic downturn is affecting project management professionals, their earnings, aspirations and outlook for 2009. We are already seeing a reduction in opportunities in the first months of 2009, currently 47% down on 2008 levels. At the same time we are also seeing an increase in the number of candidates becoming available in the market so competition is tough for both employees and contractors.

When trading conditions such as those we are currently experiencing occur, many people believe that it means we have shifted into a "buyer's market". Is that true and what does that really mean?

Typically when a buyer's market occurs the following conditions are assumed to be true: There are more people available in the market looking for a new role and there is a reduction in the number of opportunities available. As a consequence a common assumption is that employers have the pick of the market and can even squeeze the remuneration on offer.

Our experience of the market relating to Project and Programme Management (PPM) leads us to believe that is not necessarily the case.

It may be said to be a buyers market if an employer is buying on price because they believe that the skill set they require is more commonly available than it has been in recent markets. For some employers this may be seen as a market correction as they have been paying a high rate for employees or contractors; for others it may be seen as opportune. If they can truly satisfy their requirements without compromising the skills they acquire then yes they are in a buyer's market.

Another trend we have heard of in the current market is employers asking employees and contractors to take a rate cut in order to retain their position. Once again this may be seen by some as a buyer using their power position to reduce costs. However if not done correctly, this course of action may cause future issues for the business as it can damage the goodwill of the employees and contractors; who at some stage in the future will look to jump ship.

The good news for some is that these times will become a "seller's market"as many professionals with key skills are no longer active in the market. This group of people will generally be secure with their current employers, have a good remuneration package and feel that any move is high risk in difficult times. The 2009 Arras People survey confirms this with an increase in the number of people who do not anticipate being active in the market this year.

So employers looking for the professionals with key skills will find it harder to find and attract these professionals. As a consequence employers will need to find effective ways of firstly finding these talented individuals and then have the package to tempt them out of their current positions. If they can't, this may also have a knock on effect for contractors and interims who will be in demand to cover these positions until such time as a full time head can be engaged. Either way it should be good news for some in these days where gloom and doom seems to be the order of the day!

In terms of recruitment strategy and approach many companies feel that they can bring recruitment in-house to avoid paying fees to agents during periods of recession and use their own personnel to farm the glut of PPM Professionals that are available. Our own experiences and anecdotal evidence that we have collected from talking to senior business personnel is that the best talent is still working and thus not available.

By using the skills of recruitment experts such as those at Arras People you not only save the hidden cost of internal recruitment, but also gain access to;

• Our database of PPM Professionals who are not active in the market
• Market intelligence to attract the top talent
• One to one selling of your organisation to potential recruits

If you need to recruit during a recessionary period it generally means that you have business or a critical business initiative to deliver. We suggest that organisations consider the "opportunity cost"of not having the best PPM professionals available to deliver against the "saving" generated by not using a professional recruiter.