Increased usage of temporary resource as a result of COVID19
The current market has taken a sizeable hit across the board with certain sectors and industries being more severely affected than others.
Within financial services the transactional financial services space has been one of the hardest hit. Most of our clients are reporting much lower transaction volumes, as well as having issues with pricing their transactions, which has led to them having to restructure/close out many current positions.
Standard M&A has also been affected due to the requirement for site visits, but many PE houses are using this time to restructure debt due to the incredibly low interest rates available.
Within the investment banking world, there is a large amount of distressed debt work, due to many corporates requiring heavily leveraged financing to get through the troubling time caused by COVID-19.
The funds space has slowed but many active managers have stayed ahead of things and continue be profitable whereas those on the passive side haven’t fared so well
It is not all doom and gloom across all sectors with some holding up reasonably well. The tech and life sciences space are particularly buoyant, with SaaS based businesses being less affected by the lack of face to face interaction, combined with COVID-19 creating increased use of many life sciences products, including the search for a vaccine and the products associated with the treatment/prevention of the virus.
Prior to the pandemic hitting and more clarity having arisen on the BREXIT situation, it had created a much more positive recruitment market, with vacancy volumes increasing significantly on the prior year. Permanent hiring has stuttered badly since and while we remain positive about the medium to long term future of the market, we have seen a short term shift to it being much more employer led with a relatively low vacancy volume and higher numbers of lawyers available.
Uncertainty always has a negative impact on permanent recruitment, but there has been a modest but noticeable increase in the use of temporary workers. During a time when getting sign off for permanent hiring can be difficult there are still many situations where urgent resource is required to cope with certain work requirements.
There are many clients who have made use of this for years, but many more are starting to see the flexibility it can offer and the chance to solve problems in the short term, buying time for a more strategic approach to team growth. We have several clients who always keep a mix of permanent and contract staff on their team due to the flexibility it affords them.
The right interim hire can add significant value but shouldn’t be seen as competing with secondments.
Secondments will always be a good source of staffing within the in-house world, but we are seeing more and more, clients struggling to take on a secondee. The salary burden to private practice firms as well as the shrinking team size within niche skill sets makes it much more difficult for the law firms to allow high calibre lawyers to leave on a secondment basis. A lot of lawyers we are speaking to, have had their requests for secondments turned down, particularly if they are in high demand areas, such as derivatives, securitisation, disruptive technology and structured products.
Hitting the ground running is key in the demanding in-house world, with many interim lawyers dedicating a number of years to providing interim support, allowing them to add significantly value from day 1. They can help provide more support than a more focused permanent hire, where a client cannot afford or get sign off to hire permanently. The lawyers are used to coming in to lead on specific projects and have strong experience in flexible or remote working that is the new norm due to COVID-19.
There are many reasons why our clients come to us with interim needs: whether it be to cover a maternity, sickness, holiday or sabbatical leave, or simply due to the difficulty in hiring the right person in tough market conditions, when there is an urgent need.
The main reasons people hire interim Lawyers:
1. Permanent hire – gap fill
An Interim Counsel can fill that gap on your team, bringing in necessary resource at a fraction of the hiring time, and you never know, the hire you are looking for may end up right under your nose. There’s also no danger of the dreaded counter-offer.
2. Maternity, sickness, holiday cover
Staff shortages: whether it be maternity or paternity leave, a sabbatical or possibly prolonged illness often leave a large gap in in-house legal teams. Even one person missing for a couple of weeks can increase the workload on the rest of the team significantly so getting an interim in as cover can increase productivity and morale.
Interim Counsel is often available at very short notice, even in this ever demanding market. Many can interview on occasions within hours and if needed can start within a matter of days. This makes the onboarding process a much quicker and simpler process, which is hugely valuable in this current market.
4. Subject matter expertise
Another reason clients take on Interim Counsel is for a specific project. Many dedicate their career to gaining experience based on project delivery and stakeholder management, thus being able to offer instant specialist knowledge in a particular area of law, so making an immediate impact on your project.
When looking at your annual budget, hiring an Interim Counsel may be the most cost-effective solution. Many clients believe a temporary hire is hugely more expensive in comparison to a full time employee but when you consider the full costs involved – your time taken out to deal with the hiring process, recruitment fee, annual salary, bonus, NI, other allowances and benefits, annual leave etc – the true costs of making this hire can be the same if not higher than the cost of a daily rate.
Barclays Simpson is on hand to provide support if you are looking to make an interim hire, or even if you require advice on price, market conditions and candidate information. We have a database of over 4000 interim lawyers, who can hit the ground running.
Please contact Tom Boulderstone on 020 7936 8943 or firstname.lastname@example.org to discuss this further.