January 2010 / Edition #5
At the pinnacle of New Year's Eve, when the calendar switched over from 2009 to 2010, many of our clients and candidates breathed a sigh of relief. Though the Canadian market has weathered the recession far better than most economies, this was a year that most were happy to put behind them. For Thorek/Scott and Partners, it was a tumultuous time. We saw a swell of highly qualified candidates concerned about their next step. We also saw recruitment remaining cautious yet still robust.
2010: An Opportune Year
Looking back on 2009, and ahead to 2010, we hope to give you a sense of where the market for talent will take us in the coming year in capital markets, finance and accounting, risk management, global initiatives and diversified fields.
This past year often saw new hires accepting positions they didn't necessarily want, at lower compensation than they had hoped. Existing staff felt the negative impact of the markets in their own development through lower deal flows or tougher credit and equity markets. They acquired less experience because they were spending their time pitching for business, instead of executing transactions. Limited promotions and layoffs frustrated many in management. The loss of mentors had a significant impact on morale and learning for employees, as the greatest cuts seemed to affect mid-level associates and VPs.
This, combined with downward compensation and a lack of clear direction from top management, could create a flight risk in 2010. Employers need to understand that despite the employment situation overall, strong available talent is disappearing, and multiple offers remain common. Companies need to sell opportunities to strong candidates - they need to demonstrate the strategic direction of their firm, and the long-term development of the candidate's career within that. They also need to react faster. Hiring has picked up significantly, and competitive offers are snatching up talent within weeks of initial contact. A premium will be placed on candidates with international experience, returning from capital markets roles in the United States and abroad, where the sector remains shaky.
Finance and Accounting
During this past year, many professionals moved from revenue generating positions into oversight and operations roles. Companies became more operationally focused, and we expect this trend to grow during 2010. Finance departments can expect to be faced with increasing demand for enhanced financial analysis to improve upon profitability. Finance will become more involved in shaping strategic business decisions.
Hiring will increase to rebuild teams dismantled during the recession's height. Standout candidates will combine core skills (strategic thinking, modeling skills, full cycle accounting experience, accounting policy knowledge, change management) with entrepreneurial drive and soft sales abilities.
2010 will bring a heightened awareness of risk and a broader assessment of what can go wrong. Focus will continue to grow on monitoring and managing operational risk. A new trend emerging is a focus on the management of liquidity risk; companies will need to reassess the sources, sustainability and suitability of existing capital. Expect to see liquidity updates on the agendas of more Board meetings. Financial institutions are working on converging market and credit risks, taking a comprehensive view of the overall situation.
In 2010, companies will need to ensure that they have resources qualified to develop alternative solutions for the prevention and resolution of liquidity issues. There will be a need for individuals who have experience with accessing capital, as well as those with strong strategic backgrounds. The major challenge within financial institutions will be to attract talent who can bridge the gap between executive leadership, those running the business, and those running the models. If not adequately managed and sufficiently understood, the complexity of the risk measures and models could actually increase risk.
In this respect, candidates need to demonstrate a clearer understanding of the underlying business, and the ability to communicate their numeric analysis clearly and simply to non-quantitative management, employees, and shareholders.
As emerging markets matured this past year, and technical expertise became more easily available locally, clients' focus shifted toward attracting candidates with sustainable leadership abilities. These candidates were charged with driving the business and producing tangible bottom-line results. Candidates continued to face adjustment when dealing with the young business culture in emerging markets, and faced the challenge of establishing fresh networks in foreign countries. Overcoming the perception and stereotype of the short-term detached expatriate is crucial to gaining the sustained trust of locals.
As global markets pick up throughout 2010, we should see a renewed demand for expertise in the areas of financial services that have direct exposure to Western sources of financing. As the prosperity of emerging economies improve, local companies will seek business advisory services that can help attract investors from the West, expand their market share, and strategically navigate through the next growth phase.
For many of our clients outside of financial services (real estate, consumer packaged goods, engineering services, and manufacturing), 2009 was an unproductive year. Both candidates and companies took stock of their long-term goals and planned for the future. This often led to cautious recruitment processes. Candidates went through lengthy rounds of interviews, reference checks, and rigorous evaluations before receiving an offer. The misperception was that the market was filled with endless talent, and because of this, many employers wanted to ensure they were seeing as many candidates as possible. There was uncertainty on both sides as many candidates were understandably hesitant to leave their current employers, despite looking for career advancement.
Overall the mood was conservative, but by late 2009 we began noticing a surge in new hiring. As businesses begin to rebuild depleted ranks, we anticipate a resurgence in recruitment, especially for mid management talent. Companies who shed senior managers at the height of the recession are continuing to place junior talent into positions of greater responsibility. Top talent will remain in high demand. Overall, the buyers market has already begun to ebb, so expect a more competitive environment for talented candidates with the desired skills.
|Thirty-six years ago, Brooklyn natives, Faye and Michael Thorek moved to Toronto. Through chance, persistence, and a misguided creperie adventure, they started up Thorek/Scott and Partners, one of Toronto's most prestigious executive recruitment firms.
Looking back over the past year Faye and Michael share their thoughts on employment, talent, and their hope for the future.
||Thoughts from our Founders - Faye and Michael Thorek
If the employment rate is to recover more rapidly or suddenly than expected, it may reflect the fact that this recession began in a sudden panic during the fall of 2008. Many companies quickly cut the expenses they could, motivated by a combination of fear and fiscal conservatism. The speed and scale of these cuts may have been overdone, leaving these same companies with a need to fill the gaps in their workforce.
Since the last quarter of 2009, there has been a rapid growth in companies retaining search firms. Our clients realize the pace of business has recovered significantly enough to begin the process of recruiting talent for future growth, as well as maintaining current plans, even if the overall economic recovery appears tenuous.
Talent, in good or bad markets, is difficult to recruit and retain. It requires a coordinated approach, between individuals seeking opportunities and the companies who have challenges to offer. At Thorek/Scott and Partners, we've built and maintained thousands of collaborative relationships between our clients and talented candidates over the past three decades. In good economies and recessions, bull and bear markets, the one thing that never loses its value is human capital.
As we enter a decade where technology will undoubtedly occupy even more of our lives, tying us to our computers, phones, and websites, let's step back and take stock of our most important networking device: each other. One of the things we do best at Thorek/Scott and Partners is connect with people - not network, or make contacts, or analyze. We sit down and speak with our clients and candidates, face to face, and we get to know them as individuals. Who are you? What brought you here? How can we help? We match personalities as much as qualifications, desires far more than skills. This year, we hope to put more people together, to build partnerships and relationships, which will ultimately make us all a bit more human.