After a very encouraging first half of 2008, when tales of the “Credit Crunch” and the “American sub-prime” phenomenon appeared distant and irrelevant, the later months of the year began to show just how tough times had become.
By late autumn it was not just bankers that were suffering; the world economy’s reliance on credit to fuel its rapid consumer spending growth of the last 16 years finally came home to roost. High raw materials and commodity prices, a lack of “real-world” liquidity in mainstream retail financial services and associated “consumer jitters” ensured that the downturn was rapid and widespread.
We are now officially in a recession and it certainly feels like one; consumer confidence and business forecasts are both plunging.
I am not quite as despondent or pessimistic as some commentators; the fundamentals of the UK economy as we approached this crisis were much stronger than those of the early 1990’s – low interest rates, low inflation - and whilst our government was clearly culpable in getting us into this state they have at least had the common sense to act swiftly and concertedly to get us out.
I don’t have a crystal ball and I am not an economist but I think the economy may start to grow again in the latter stages of 2009. However, most of next year will very tough and it could be further 6 to 12 months before any growth in the economy filters through to hiring decisions.
How has the recruitment sector fared during these straitened times? Well, the UK labour markets are now reflecting the general lack of confidence and unemployment is rising. We have seen businesses go to the wall in the North and Midlands and many have announced redundancies, headcount freezes and “delayed decisions” in equal measure. Some sectors have been hit very hard eg general and fashion retail, construction, automotive and those relying on the wholesale banking markets for funding. Others appear more robust; Food Retail, Pharmaceuticals and Defence were outperforming the market at the end of 2008 and the Public Sector is thriving. We have seen recruitment demand fall certainly, but not disappear, there are always markets and businesses that are hiring and always exceptional opportunities for talented professionals
One would expect, with demand falling, that supply would increase but that isn’t the case across the board. Many candidates are “sitting tight” afraid of exposing themselves to the labour market in uncertain times and the recruitment maxim that “good candidates are hard to find” still stands.
Ardent are committed to ensuring our clients have access to talented professionals and in turn they have access to exceptional businesses. The “war for talent” will still go on regardless of the strength of the economy and Ardent will continue to fight it in your behalf.
David Colgrave
