Grounds For Optimism Despite Uncertain Times

By Author: John Holmes
Total Articles: 7
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The latest Government and independent figures may suggest that the worst of the recession is over, but for interim managers and other temporary and contract workers, there remain uncertain times ahead.

In the past few weeks, a report by the Recruitment and Employment Confederation (REC) and KPMG revealed signs of recovery in the labour market, with employers becoming more confident in their hiring decisions.

The report signals a return to growth, albeit only marginal, of both permanent and temporary staff appointments during August.

Speaking to the BBC, REC Chief Executive Kevin Green said the report signalled a return to growth, albeit only marginal, of both permanent and temporary staff appointments.

However, the level of unemployment is now at its highest since May 1995 and the latest government figures show that Unemployment increased by 210,000 to 2.47m in the three months to July of this year. However, many experts believe that falls in unemployment will lag behind improvements in economic growth.

John Philpott chief economist at the Chartered Institute of Personnel and Development (CIPD) ...
... has predicted a gradual increase in net job creation and continued high unemployment for another six years.

There are also fears that the UK could endure a ‘double dip' recession, especially as the current economic recovery appears fragile. Philpott went on to warn that this could see unemployment peaking at 3.5 million and unemployment not returning to 1997 levels for at least a decade.

This situation could be made worse by early cuts to government spending to reduce the current budget deficit. This could have a severe impact on public sector recruitment.

But the general economic outlook isn't the only challenge interim managers may face in the months ahead. A number of organisations that represent interims, the agencies that find work for interims and other companies providing HR services, warning of more dark clouds on the horizon.
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Government plans to introduce tighter Criminal Records Bureau / CRB checks have the potential to disrupt all types of interim management work if there is any contact with children or vulnerable people.

Even an interim whose primary responsibility covers payroll services or HR services could require a CRB check if the place they are working is frequently visited by children or the vulnerable - a scenario that is common during public sector placements.

Whilst protection of the vulnerable must always remain a priority, there is the risk that over zealous measures will unnecessarily add to the paperwork associated with recruitment, public sector recruitment in particular.

This may result in organisations being denied the flexibility to take on an interim manager at short notice - as is often required - and further restrict the labour market at a time when it needs to be encouraged.

Perhaps a bigger threat to interim management and all other aspects of outsourcing services is the implementation of the controversial European Agency Workers Directive.

David Harries of the IMA Institute said it means temporary workers would be treated like employees, required to receive holiday pay, sick pay, and many other costly employee benefits. As a result the IMA is campaigning for interims to be exempt from the new rules.

Meanwhile, the REC estimates that the jobs of tens of thousand of agency workers could be put at risk by the EU rules to give permanent and temporary staff equal treatment.

Whilst many interims operate their own interim consultancy and offer HR Services, Payroll Services and other skills directly to clients, many other rely on agencies to find work for them.

Although unions have campaigned for many years over the issue - claiming that temporary staff are given a raw deal in terms of pay and conditions - the proposed directive takes an all encompassing approach to the issue.

Whilst there have been cases of exploitation, the directive fails to take into account that many people choose to work on a freelance basis out of choice and both the CIPD and the REC have called for delays in its implementation.

As well as being too complex, they believe it will also strangle demand for temporary workers at all levels.

Although many of the changes will not directly affect many interim consultancies, Kevin Green of the REC says the availability of a flexible labour force will be key for struggling businesses climbing out of a recession. He added that any early implementation of the Directive could kill off these green shoots.

Despite the current economic situation and the threat of more red tape for government, it's not all doom and gloom for the interim management sector and businesses offering outsourcing services.

As the recovery takes hold more businesses will need to take on professionals to cope with an upturn in demand. Interims are best placed to meet this demand as businesses in particular may be reluctant to take on permanent members of staff for fear of the ‘double dip' effect and interims can provide the ideal solution.

However, competition for placements will be fierce as many skilled professionals will have entered the interim market after being made redundant from their previous jobs. Interims would be well advised to spend any downtime brushing up on their skills, getting up to speed on developments or just improving their interview techniques and getting familiar with psychometric tests, which are becoming increasingly popular. Employers are using them as a mechanism for sifting the ever increasing number of CV's being presented for every vacancy.

John Holmes has been involved, at senior levels, in the HR service, career management, psychometric testing and interim management industries for over 10 years.
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