If we exclude the actions of global recruitment firms, which I typically do, the last 12 months have been the most tumultuous I’ve witnessed in my 13 years in the New Zealand recruitment industry. Even during Covid, most of us retained our jobs. Sure we took pay cuts, didn’t shower, and spent our days persuading our kids to form a vocal harmony group with us, but thanks to a number of contributing factors, most of us came out alive. If I look at FY23/24 however, a number of recruitment firms across the board decided to restructure, downsize, go bust or otherwise rethink their strategy. This wasn’t limited to bad operators either. Market pressures, AoG, the new coalition government, interest rates, and David Seymour’s weasel-like face, have resulted in many of the very top firms deciding to reshape their business for a changing market. It has not just been agencies of course. The number of internal recruiters reaching out to me is at a record high. The turnaround we expected early this year hasn’t happened, and I genuinely cannot remember the last time I placed a perm internal recruiter. Actually I can. It was in December…2022.
It has not however been the disaster the above sensationalist paragraph may suggest. Here at Rice, we’ve had a solid year given the circumstances, meaning that agencies must be hiring. Most quality agencies have remained profitable, it’s just these profits are dwarfed by the two previous years. Most recruiters remain in employment, and mostly because without even knowing it, they’ve future-proofed their career. And speaking with so many recruiters, I’ve spotted a few trends on what makes a recruiter safe in turbulent times. Firstly, let me tell you what it’s not.
It most certainly isn’t “going internal”. Once upon a time, internal recruitment was a safe place for a recruiter to ride out a recession. Currently, you are much more likely to pay your mortgage if you stayed agency-side. I cannot think of a single internal function who is growing their team, and most are not replacing those who move to London or die from boredom waiting for Snaphire to load. And this brings me on to another safe-haven turned waste ground. You are most certainly not safe if you go internal with a government agency. Chris Luxon, who thinks forcing women to give birth to children they don’t want is a good idea, has made it very clear: do not be a government recruiter under his watch.
It’s also not increasing your basic salary versus the “at risk” component. Many recruiters over the last few years have commanded/demanded increasingly high base salaries. The advantage of this is that on a slow quarter, you can still pay the bills. And high salaries are good right? Wrong. If you are agency-side, high salaries typically mean high thresholds, so you’re often no better off. High salaries are also the first to be looked at when the market tightens. I have been working with a number of recruiters who now find themselves between a rock and a hard place. Too expensive to retain their role, and too proud (or owing the bank too much) to find a new one. Had they been on $90k instead of $120k, they’d still be employed and earning well.
It’s also not being promoted. Redundancies and restructures have hit those at all levels this time round. The idea that joining the managers club will safe-guard you from the fire exit is a fallacy. In fact, as firms seek to lean-up, slashing a whole tier of non-billing, high-salaried employees, seems like a really f*cking good idea.
It’s not being a Candidate Manager. 2 years ago, in a booming market, you guys could name your price. BD was easy, but what our clients wanted was warm bodies. If you knew a bit about IT, could do a Boolean search, and liked to be busy, there were 10 jobs waiting for you. Unfortunately, this market is really not suited to Candidate Managers, and sadly, I probably work with these guys more than any others.
In my opinion, the best way to remain a recruiter, retain a good income, and provide for yourself and your family in the future is as follows; work for a recruitment agency. Do not rely on recruiting for the government. Do not request a salary above the market average. Always work in a role that generates revenue. And whether you like it or not, learn to gain a perverse enjoyment from business development. Although it sounds simple, if you remove any of the above, you massively increase your risk of unemployment in a slow market. If you want to manage recruiters, that’s great, but you need to maintain a billing desk. You may love candidate management and be very good at it. However, if you start bringing clients to your consultants and not just candidates, you would be safer right now. A high basic is appealing to all of us, but it will probably do you more harm than good. And if you don’t like selling, internal recruitment is no longer a safe haven. You either need to learn to enjoy the pain of sales like we learn to enjoy some of the more taboo sexual acts, or think about pivoting your career.
That is all for today.
^SW
