Quarter Two Market Update
July 2010
Welcome to the Goodman Masson quarterly update on the Commerce & Industry Tax market. My aim is to give an overview and identify any trends or developments in this recruitment market.
Please scroll down to read the update in full, or use the quick links below to navigate to the most relevant sections.
I welcome any feedback relating to this newsletter, so please reply to this email with your comments and I will try to incorporate any suggestions in future.
Should you have any questions, please do not hesitate to contact me.
Kind regards,
Wilf
Wilf Cleave
C&I Tax Division
Direct: +44 (0)20 7019 8875
Email: wilf.cleave@goodmanmasson.com
Market Update
Commerce & Industry
As Q2 draws to an end what can be said of 2010 so far?
In-house tax recruitment within Commerce & Industry continues to show inconsistent signs of recovery, the trends we normally see in H1 were simply not there. So, where is the increase?
The recovery has been predominantly within specialist areas of tax, such as Transfer Pricing, which is growing at a faster rate than traditional in-house corporate tax positions. However, this perception is potentially enhanced by the relatively fewer numbers of TP positions in-house existing previously. Energy and FMCG are more buoyant than other sectors, yet marginally so. Also, there are still signs that bringing compliance further in-house to maximise cost and commerciality is an area of increase.
The question we need to ask is how do we measure signs of recovery? Quite simply, in recruitment, this is measured by the volume of jobs available on the market. Q1 saw an obvious increase in opportunities, particularly at the beginning of the year – consumer and business confidence was up thanks to a spirited fight back from the FTSE, and ‘a new beginning’ outlook amongst business leaders, the media and the public. This confidence continued through most year-ends and well into Q2. The obvious inconsistency comes when analysing Q2 2010 against April and May of recent years. This is a time when new budgets have been set and headcount is increased before the summer vacation. Traditionally, in June we expect a lower level of activity, yet Q2 of this year actually saw a fairly depressed May and a pick up in June. Perhaps we should not have expected normal trends to return in tax recruitment until Q3 2011.
Transfer Pricing, VAT and Global Mobility have been the key areas of increase within Commerce & Industry. This is compared to a much smaller increase in the number of Corporate Tax roles for the same period. However, despite candidate demand in these specialist areas, clients will not opt for second best and as a result recruitment timescales tend to be delayed somewhat. This is probably the natural mentality that one would adopt; given that the budgets to hire are still restricted in many organisations hiring managers want to make absolute certain that the potential employee really does have the right interpersonal attributes and technical skill set for the job. In a good market, where candidates are scarce, clients might have been happy to opt for someone who matched 70% of what they were after; in today’s market clients are really looking for 9 out of 10 boxes on their wish list to be ticked and as a result this can add to the time it takes to hire the right candidate.
Another sign of inconsistency and that the market hasn't quite stabilised is the continuing, although sporadic, redundancies that are still being seen in the Big 4 accounting firms. The volume of those being made redundant doesn’t compare to those made in the early stages of the recession, but it’s still a significant sign of the UK’s continuing economic struggle and its difficulty in finding its way to the full path of recovery.
Many C&I in-house tax teams have seen very little M&A and transactional work and the roles of project managing Heads of Tax have become little more than tax controller type roles. This has a two fold outcome; firstly the increase of senior tax professionals registering with us (either as a result of redundancy or because they seek new challenges); secondly that in-house tax departments will try and spread any excess work internally (the preparation of tax computations is increasingly being pushed to finance for example, after which the tax team can review) to try to cut costs through the need to outsource work. This directly impacts the Big 4 firms with redundancies and the tax recruitment market generally.
In our last quarterly update we discussed the lack of replacement hires. Now, the good news is that back-filling positions where employees have left the business is increasing again and the profile of in-house tax teams has risen due to effective tax planning. Whilst the short term fix of having an external advisor is an option, hiring managers are now realising the benefits longer term of recruiting someone on a permanent basis to cover advisory and compliance work from a cost and commercial perspective (especially as some in-house Tax Directors haven’t seen their advisors ‘share the pain’ in this current economic climate in terms of fee adjustment).
Conclusion
Businesses outside Financial Services rarely see bulk recruitment given the relative size and need of the in-house tax team (there are the occasionally exceptions in FMCG or Energy & Utilities). The bulk recruitment in Q2 and H1 of 2010 has appeared across certain tax disciplines, such as TP, rather than specific sectors. For the rest of 2010 and into 2011, we expect to see a further move to in-source specialist areas and bring corporate tax capabilities further in-house. The one thing we can be sure of is that for the next 6-12 months in-house tax recruitment will be subject to fewer trends than we normally expect – when this changes remains to be seen.
2010 Tax Awards
We were pleased to be able to sponsor the Cocktail Reception at the 2010 Tax Awards, and enjoyed the opportunity to meet and speak to so many people throughout the evening.
Firstly, I would like to extend congratulations from Goodman Masson to all the winners of the evening, and if you attended this year, I am sure you all can say what a fantastic evening it was.
We will definitely be attending next year.
2010 Goodman Masson Salary Guide
In this comprehensive document, we have taken a look back at the changes that have occurred across the markets over the last 18 months and have looked to the year ahead, to determine what could be expected for clients and candidates.
In the current economic climate, the parameters for gauging bonuses are so wide that Goodman Masson is unable to give target ranges as you would have seen in past documents. We have given an overview of expectations, but your specialist consultant will be able to give you a more detailed and case-by-case discussion.
To view the document, please click here.
Goodman Masson
The Tax Team
Our dedicated Tax Division is made up of five experienced tax recruiters, all of whom have spent many years recruiting into the tax area. Our team recruits for all levels within Industry and Professional Services firms, from newly qualified through to Head of Tax and from part qualified through to Partner grade.
Since its inception the Tax Division has worked with leading UK and multinational organisations, Big 4, Top 50 and boutique tax firms.
We cover all specialisms within tax, including Corporate Tax, International Tax, Transfer Pricing, Personal / Partnerships / Private Client Taxes, Expatriate Tax, Employment Tax and Indirect Tax.
Our success has been built on honesty, specific market knowledge and the breadth of contacts within this area. Our market leading research capability combined with investment in our candidate acquisition model is what has helped us make each mandate we recruit for as seamless and effective as possible. In the last 6 months we have worked on 74 opportunities with 48 leading organisations and have spoken to over 492 qualified tax professionals, 115 of whom are actively seeking new opportunities through us.
Goodman Masson
Goodman Masson is the largest Independent Financial Recruiter in the UK and has been recruiting professionally qualified accountants and other finance professionals for over 17 years. With a team of over 90 we hold annual revenues exceeding £19m.
Our growth has been built around our knowledge and expertise within the Finance markets and in 2009 alone we successfully worked with 991 separate organisations. Our client portfolio ranges from the FTSE 100 (67 out of 100) to small entrepreneurial start ups and from Government bodies through to independent media houses.
Goodman Masson
7th Floor | 120 Aldersgate Street | London EC1A 4JQ
Main: +44 (0)20 7336 7711 | Fax: +44 (0)20 7336 7722
Web: www.goodmanmasson.com
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