Slower economy not affecting recruitment market

Mainstream business confidence may be low and food and fuel prices are certainly biting, but rather than causing a downturn in the recruitment market, tough times seem to be driving it.

Richard Gladwell, director at ITEC Recruitment says 70% of those in work continually look for better jobs and people increasingly realize the only way to get a big pay rise is often to move.

Surging petrol prices mean commuting is becoming more expensive and ITEC increasingly sees applicants demanding work closer to home where before they would have taken the hit and commuted across Auckland, for example. Proximity to public transport, including ferries, is also becoming a factor.

"If there's flexibility in working hours, people will wear the longer travel but the cost of sitting in a car is huge and increasing mortgages mean budgeting is pretty tight," Gladwell says.

Jo Clegg, director of Outsource IT Recruit also reports fuel costs driving a growing keenness to work closer to home but warns some employees are demanding too much and employers are getting resistant to paying more.

Other recruiters report business as usual and that means business is good and many skills remain in short supply. Absolute IT says the market is "pretty buoyant", Beyond Recruitment says "very good" and unlikely to change in the next few years, Alliance IT confirms a scarcity of high-quality candidates.

However, employers seem to be taking longer to make their selections.

Clegg at OutSource IT says it is a big challenge to find someone who has "the right personality to fit snugly into the existing team". Megan Fletcher, director of Protocol Personnel, agrees, saying hiring managers are being more conservative. Sarah Lee, director of IT Maniacs, says staff selection is taking longer as it is often better not to hire than make a wrong hire.

Lee believes much talk of a skills crisis is "media scaremongering." Employers are impatient, she says, expecting the right candidates to turn up within a few days from placing an ad on a job board when more creative strategies may be needed to find them.

However, Lee reports a few recent redundancies as the market has levelled off, while ITEC notes some projects are being delayed due to growing economic uncertainty. Absolute IT says political uncertainties may also cause a pre-election pause for some projects a few months from now, and both Candle and Alliance IT see a decline on contracting.

Nationally, recruiters report similar buoyant conditions in both Auckland and Wellington, although John Lacey, director of Beyond Recruitment, says many projects in the capital need resourcing. Government work means Wellington is always consistent, says ITEC's Gladwell, while Auckland fluctuates more due to varying business confidence.

IT Maniacs notes a busy telco and government sector but adds there is "significant growth in the provinces", citing Hamilton's booming agricultural sector.

Three months ago, the Department of Labour released its 2008 Survey of IT Recruiters. The survey of 30 IT recruiters reported that 35 of 50 IT occupations surveyed were difficult to fill. Difficulties were greatest for business and systems analysts and programmers, database and systems administrators and security specialists, designers and network and support professionals.

The market in June seems little different, driven by b2b and virtualization projects within the banking and insurance sectors especially, creating opportunities for developers, in Microsoft .Net and similar technologies.

ICT management was the only broad group to have no occupations difficult to fill. Candle reports one CIO vacancy attracted 65 applicants. Other recruiters report a glut of project managers, a shortage in the mid-market and too many candidates for vacancies at senior level.

"At the senior level, there's a lot of people looking to move," says Candle ICT general manager Paul Leacock.

Candle also reports shortages in testing, business analysis, project management; plus architecture and development languages such as .Net and Java. Alliance IT sees experienced .Net and designers in short supply. ITEC confirms a need for Microsoft development skills, as does Protocol, noting Cisco skills are also in demand.

Absolute IT also reports demand for new skills such as Ruby on the Rails, virtualization and knowledge of Juniper networking technologies.

"MCSE is still hot, Sun certification helps project managers, PMP is a definite for project managers. Employers increasingly demand qualifications to ensure candidates have been trained in best practice," adds Sarah Lee of IT Maniacs.

Immigration is helping to fill these gaps, but it's a two-way process as Australia remains a drawcard, with Beyond Recruitment reporting the UK is also a popular destination.

Many recruiters also have overseas operations and affiliates, which draw candidates to New Zealand, both foreigners and expatriate Kiwis coming home. Absolute IT is one company putting greater emphasis on the Kiwi expat market, with an extra staffer in its London office adding to effective interviewing and recruitment from there.

Outsource IT Recruit also plans to participate in government Working In NZ programs and attend recruitment fairs in Britain and the UK. Outsource IT's Jo Clegg says employers will often interview people by phone or Skype but are often put off by the paperwork required for immigrants, so will tend to favor a returning Kiwi. But this means they miss out on talented "new Kiwis" who will grab opportunities presented.

Protocol also advertises at such fairs, reporting a constant flow of returnees and immigrants. It is also receiving more Asian applicants. This commitment to diversity is documented in contracts between Protocol and its multinational vendor clients, says director Megan Fletcher.

Candle reports people are increasingly being interviewed in their home countries at their overseas affiliates before arriving into New Zealand. They tend not to have job offers before setting foot in New Zealand, but will at least have several job interviews lined up.

Recruiters report other market changes, such as diminishing effectiveness of online job boards. Martin Barry, at Absolute IT, says such sites used to attract many applicants but their growing number and the growing numbers of companies using them, means each vacancy gets fewer applicants as it is quickly supplanted by another vacancy on the listings.

Recruiters are turning more to their specialist knowledge and contacts to offer better service to clients, particularly as the larger firms especially have tended to develop their own in-house HR teams. Now, agencies are used more for specialist areas like finance and IT or harder-to-fill roles.

"This is where our networks come into their own," says Protocol's Megan Fletcher.

Candle notes a growing competency of in-house recruiters, with Paul Leacock saying his agency co-brands recruitment materials with employers and provides specialist advice. It has also moved more into the medium-sized employer sector.

But agency costs drive much of this trend, says IT Maniacs' Sarah Lee, adding many in-house HR departments often contain former recruitment consultants. Recruiters will charge 12% to 18% of a salary in fees and when everyone may have a database containing the same 25,000 CVs it is hard to justify such charges.

To answer that challenge, IT Maniacs has developed a flat-fee model as well as offering a range of "pick and mix" services to match new recruitment models. It also stresses creativeness in its job advertising, as well as launching ManiadsTV, an online video jobs board. It is also targeting smaller businesses.

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