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UNPRECEDENTED LEVEL OF SCRUTINY OVER HEADCOUNT LEVELS AND HIRING DECISIONS

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UNPRECEDENTED LEVEL OF SCRUTINY OVER HEADCOUNT LEVELS AND HIRING DECISIONS

Global professional services recruiter, Morgan McKinley revealed in its 2017 UK Salary Guide that 2016 was one of mixed fortunes for professionals in the UK.

David Leithead, Chief Operations Officer of Morgan McKinley said: 

logo“Uncertainty was the overriding sentiment in the UK business sector last year. We saw the impact of that in reduced volumes of job vacancies in many industry segments, particularly permanent roles in the larger employers, for whom the political and economic backdrop meant an unprecedented level of scrutiny over headcount levels and hiring decisions. As a consequence the professional temp market inevitably saw better conditions. For the moment this balance is likely to continue.”

“Every year recruiters mark a new zenith in the rise of the specialist, and this report is once again full of examples of big wage increases being needed to attract the specialist skills that hirers seek. Of course the very fact these specialists exist is a reassurance to those concerned about the UK’s future post Brexit – increasingly it is the assuredness of the supply of talent, above all else, that decides where an employer will base itself and the UK will always remain competitive in this area.”

Key Morgan McKinley UK 2017 Salary Guide highlights:

Accounting & Finance

  • There has been strong demand across the board throughout the year for newly-qualified accountants, and specifically auditors making their first move into industry.
  • A number of the larger banks kept low volumes of hiring, due to critical-hire-only policies, but the small to mid tier institutions have maintained a steady flow.
  • Owing to increasing demand on businesses to comply with changing regulations, candidates with a confident technical understanding of IFRS are becoming increasingly popular. Job seekers with IFRS15 IFRS16 experience can potentially gain a premium over their peers.
  • Our interim and qualified contract divisions received a broad selection of roles, with analytical and commercial finance support roles dominating their mandate in 2016.
  • We saw a 24% increase compared to 2015 in FP&A positions as businesses continue to invest this area, seeking clarity on the long term projections and possible threats in asset management

Compliance

  • Regulatory change has driven a lot of the recruitment that we saw over the year, with MAR in July, many firms invested heavily in bolstering their surveillance teams.
  • Throughout the second half of the year we have seen firms hiring MiFID II specialists with an eye on January 2018, when the legislation comes into play.
  • Salary increases are healthy, but not at the lofty levels that we saw in 2015, where professionals could expect anything upward of 20%.
  • The multitude of regulations impacting compliance teams has seen employers requesting specialist knowledge of these regulations from new hires, we expect this area to continue to grow in 2017.
  • With GDPR coming into effect on the 25th May 2018, we have seen a number of firms within financial services hire in this space. They are predominantly looking at two types of people:
    1. Project managers, who have experience of working on implementing privacy policies
    2. Privacy SMEs, these individuals are mainly coming from a legal background with recent experience in privacy. Due to the competitive nature of this area, employers are considering candidates with privacy experience from different industries.

Risk Management

  • The year saw an increase in hiring in the quantitative risk space, mainly around the model validation and methodology areas.
  • We saw good levels of recruitment in the operational risk space, namely around 2nd line of defence projects.
  • We anticipate that 2017 will largely mirror these trends, with quantitative risk again expected to be the main area of hiring, particularly with incoming regulatory changes.
  • Basel compliance deadlines have been pushed back and are again at risk of falling further behind – nonetheless junior individuals with this knowledge are creating competition between institutions and pushing up salary brackets significantly.
  • From a change perspective, we are seeing a greater requirement for senior business analysts across data-centric projects around FDSF and BCBS239.

Tax

  • On the whole, salaries have remained flat and senior level candidates have had to be particularly flexible – those out of work often having to accept a drop on their previous package – due to lower job flow and increased competition.
  • Generally, candidates will expect to receive a 10% increase upon changing roles. In some instances, however, there have been notable salary hikes driven by niche skill sets and candidate shortages at certain levels of experience.
  • Newly qualified candidates remain simultaneously the most elusive and the most in demand. We have seen the Big 4 hire candidates with profiles they may not have even considered for interview as recently as a few years ago.
  • We have seen multiple examples of large corporations hiring candidates for permanent positions on the (two-year) Tier 5 Visa having exhausted their options (or patience) in searching for a UK trained equivalent. The fact that so many companies are showing willingness to pursue this option demonstrates the shortage of UK trained candidates emerging from training contracts.

Marketing

  • 2016 was a fantastic year of growth and opportunity for marketing professionals across financial services, technology and retail industries.
  • Marketing is becoming a higher-priority on C-suite executives’ growth plans, with team sizes increasing up to 50% and budgets becoming healthier.
  • This stands in stark contrast with previous years and moves away from the trend of cost-cutting and redundancies.

IT

  • Demand for specialist recruiters, within areas such as technology, was noticeably higher as companies looked to grow their IT divisions within projects, development and cyber security.
  • The second half of 2016 saw demand for recruitment specialists within London’s technology sector. With many of the key players in this sector announcing extensive growth plans for 2017, the hiring for technical recruitment specialists started early as companies looked to get ahead of their competitors to grow teams in line with strategic ambitions.

Business

An unprecedented Black Friday: How can retailers prepare?

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An unprecedented Black Friday: How can retailers prepare? 1

Retailers must invest heavily in their online presence and fight hard to remain competitive as a second lockdown stirs greater uncertainty

With an unprecedented Black Friday and Cyber Monday weekend on the horizon (27th – 30th November), eCommerce hosting and consultancy expert, Sonassi, advises retailers to strengthen their online presence and make the necessary preparations for a fatigue in consumer spending.

James Allen-Lewis, Development Director at Sonassi, explains: “This year’s golden quarter has squeezed together three of the biggest sales periods like never before, meaning retailers will have to fight harder than usual to remain competitive this Black Friday. With greater discounts over a longer period of time, alongside the fact that a second lockdown has moved everyone and everything online, retailers will be battling it out for a share of decreasing consumer spending.

“However, this sense of uncertainty should not deter merchants from implementing their sales strategies this Black Friday and Cyber Monday weekend. Instead, they must go further than simply providing online discounts and tackle challenges head on by re-focusing their efforts on creating a highly competitive user experience. Successful merchants will make the necessary preparations for a change in consumer demand and invest more heavily in their eCommerce infrastructure.

“One way in which retailers can do this is by using last year’s Black Friday as a case study to inspire their future response. For example, retailers should take note of the key consumer behaviours that transpired throughout last year’s mega peak in discounting and plan accordingly for the upcoming Black Friday and Cyber-Monday weekend.

“Tactics such as providing the ultimate online delivery service and secure payment methods will also be pivotal for retailers looking to survive a fatigue in online spending. Consumers will look to retailers who do not overpromise on items like next-day delivery and ensure their checkout process is safe and frictionless for all. It is the retailers who embrace this fact and meet the needs of the conscious consumer that will win their share of consumers wallets.

Allen-Lewis concludes: “With Black Friday and the build-up to Christmas just around the corner, retailers must adapt to changing consumer demand, invest more heavily in their eCommerce infrastructure and focus their efforts on creating the ultimate online experience. The only way to plan ahead amid challenging times is to listen to the needs of the customer.”

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Optimistic outlook for 2021 public M&A

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Optimistic outlook for 2021 public M&A 2

Optimism is returning and the outlook is positive for the Australian M&A market in 2021 after a COVID-induced crash in deal activity in 2020, according to Corrs Chambers Westgarth’s tenth M&A 2021 Outlook report.

The special report reveals that an environment of historically low interest rates positions M&A as a significant means of achieving growth and generating returns, including for private equity firms looking to deploy capital and strategic buyers focused on complementary acquisitions.

With the unprecedented challenge of the COVID-19 pandemic, global political instability and arguably the greatest economic challenge since the Great Depression, M&A 2021 Outlook details somewhat surprising trends emerging for the next 12 months and analyses a number of common COVID-19 myths and their influence on future M&A deal making.

Corrs’ detailed examination of the Australian M&A market draws on data taken from the firm’s proprietary database of transactions combined with in-depth research for the 12-month period ending 30 September 2020.

Key trends identified in the report include a rapid escalation in M&A levels and an increase in creativity in pricing and speed in closing deals, while also highlighting the critical need for support from target shareholders. Conditions also appear to be set for a continued rise in equity prices as a result of the ongoing influx of capital into Australian equity markets, making it imperative that bidders employ strategies to move quickly on M&A transactions.

Discussing the M&A 2021 Outlook, Corrs Head of Corporate, Sandy Mak, said “Despite a challenging year, our research indicates that 2021 could well see the volume and value of deals continue to grow. We are already witnessing this uptick in activity and while some industries and sectors are seeing a faster rebound than others, early indications are that the wider public M&A market will continue to strengthen over the coming months.”

Based on its detailed research, the M&A 2021 Outlook report discusses further key findings including:

  • Deal volume and value is the lowest since 2016, however volumes have shown significant recovery since June 2020.
  • More than 50% of deals in 2020 were ‘hostile’ and not recommended at the outset.
  • 71% of deals over A$500 million were structured by way of a takeover – a significant increase from prior years – largely as a result of increased competition for assets through rival bids.
  • Despite border closures and the tightening of foreign investment regimes, the percentage of deals with foreign bidders has increased materially since April 2020.
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Business

5 steps for SMEs to budget properly for the coming year

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5 steps for SMEs to budget properly for the coming year 3

By Fabio Comminot, Head of Dealing, Switzerland at Ebury, one of Europe’s largest Fintechs, has provided a five-step guide to make sure budgeting is done on time.

During the challenging times of COVID-19, it is difficult to forecast orders and costs. This is especially true for SMEs that operate internationally and therefore are exposed to currency fluctuations and market movements. So budgeting is immensely important.

Autumn is budget season for most companies. Upcoming project costs, sales and fixed costs must be defined or forecasted. Budget planning should be as accurate as possible right from the start of the process to avoid unexpected consequences at the end of the year..

With the effects of the COVID pandemic it has become difficult for all companies, no matter their size or history, to plan and make sales forecasts. Early planning and hedging are especially important for companies that work internationally and are therefore particularly exposed to currency risk.

These five steps will help SMEs take the right measures for the coming financial year, in time for budget season:

Step 1: Estimate your costs or sales in foreign currencies 

As difficult as it may seem, every company must estimate its expected fixed and variable costs for the coming year. Most companies can forecast their revenues based on experience or existing orders.

However, start-ups or young companies should also be able to at least estimate their costs including rents, insurance, wages and production costs. Special attention should be paid to costs or revenues that are spent or received in a foreign currency.

Step 2: Profit or cost assurance – define the strategy

As soon as an approximate plan for the coming year is in place, the company should consider the importance of currency management. Regular earnings or expenditures in foreign currencies are exposed to movements in exchange rates. If costs in a foreign currency are to be forecasted until the end of the year, the company needs to minimise volatility. This means that the exchange rate should be fixed so that there are no unexpected negative consequences at the end of the year.

Another option would be to protect the operating profit. Fluctuating exchange rates can rapidly ruin intended profit margins. In this case the company could aim to define the forecasted sales in the foreign currency and fix the margin based on this.

Step 3: Fix your budget rates 

The budget is set, the currency management goals are defined, the major part is done. Now it is a matter of defining the budgeted rates for the various currencies based on the current exchange rate. A buffer of about 5% can be useful when doing this – for example. instead of fixing the exchange rate from US dollar to Swiss franc at the current 91 cent, a rate of 95 cent could be budgeted. In this way, the minimum budget rate is defined and any negative exchange rate movement can be at least partially compensated for.

Step 4: Define the hedging strategy

With the targets and the budget course set, the next questions are: What currency developments can be expected? What is the industry outlook? Is the order situation relatively secure? Or is there practically no empirical data?

This step is where Ebury can support the company. Our experts in FX markets help answer these questions and begin to define the individual hedging strategy.

Step 5: Ensure a flexible fit

It’s done: the measures have been defined, now it’s time for implementation.

Ebury will implement the previous steps and , so that the company focuses on its core business. In contrast to traditional financial services providers such as banks, Ebury constantly monitors international trade and political events in order to assist clients with strategy adjustments. The Ebury team is supported by state-of-the-art technology and international currency analysts. It makes no difference whether the changes are driven by the currency market or whether the company’s order situation itself is changing. This allows the SME to focus on its operational business, which is worth a lot in uncertain times like these.

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