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Recruitment Matters Issue 18 September 2013

Trade Association of the Year

What’s inside The Intelligence 2 -3 and REC talk What the numbers say about gender diversity in the workplace, the campaign trail and elevating your brand

women 4-5Why matter Sue O’Brien, CEO of Norman Broadbent, speaks at the REC’s Women in Recruitment event

How to get women on the board Are quotas the answer to gender inequality in the boardroom? The European Commission certainly seems to think so. From next year, around 2,400 financial firms in the UK will need to have a management diversity policy in place, with larger institutions being obliged to reveal in writing how many women they are aiming to recruit to boardroom positions, in order to satisfy new EU rules. Legislation will not set precise targets, but it is thought that forcing businesses to reveal gender targets will naturally encourage, or shame, them into appointing more women. Separately, the coalition is also pushing for businesses to ensure that 25% of board positions are occupied by women by 2015. There is certainly a long way to go, both

for women in the boardroom and across the rest of the workforce. At a recent debate on whether gender quotas are the answer, Stuart Wheeler of the UK Independence Party (UKIP) suggested that the world of business was simply too competitive for most women, prompting outrage from other attendees. And the numbers speak for themselves – see our statistical analysis of gender issues on page 2. As we explore throughout this issue of Recruitment Matters, there are many factors that continue to a lack of women in the workplace. And there are many potential solutions, of which controversial quotas could be one. As REC policy adviser Amanda Ciske points out, the first step, especially for recruiters, is that everyone is aware of the problem.

We look at what’s causing the lack of women in the workplace

Update and 6Legal Business Matters The legal lowdown on gender in the workplace and private healthcare provision

A lot can 7 happen in a recruiter’s day The IRP reveals the results of its survey taking a look at a day in the life of a recruiter

8

The best events and training

The new REC Audited standard

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Leading the Industry

the intelligence The big mismatch

Fig 1: Annual growth in median recruiter revenue and UK job vacancies 20

We look at what the numbers say about gender diversity in the workplace

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10 %

• Although on average women are more likely to have a higher level qualification – 25% of women compared with 23% of men – they earn less than men and are less represented in management positions. How does the UK stack up? Women hold only 17.3% of FTSE 100 director positions and only 12% of the FTSE 250. There are stark imbalances within particular sectors. According to e-skills UK, women account for only 17% of the IT workforce (and only 9% of A level computing students are female) and only 5% within engineering. ONS figures show that last year, 12,880 men completed engineering apprenticeships compared with only 400 women. One of the key challenges within the UK is changing attitudes on gender diversity. In a recent REC survey, over 200 UK employers were polled about their attitudes to gender balance in the boardroom. Just over half (52%), including managing directors, HR managers and HR directors, thought that in general ensuring gender diversity in senior management was important. Similarly, 56% thought that it was a priority within their own company. The roots of gender inequality are complex and addressing the issue will require commitment from across all levels of government, education and business. The recruitment industry has a key role to play by supporting businesses to embed good recruitment practices and helping women to compete for higher-level positions.

5 0 -5 -10 Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul 10 11 12 13

Fig 2: Annualised recruitment revenue growth 10

■ Apr 13 ■ May 13 ■ Jun 13

5 0 %

Research from around the globe shows that there is a clear business case for having a diverse workforce. As reported earlier this year in the US, academics at Pepperdine University found that the Fortune 500 companies with the best record of promoting the careers of women outperformed their competitors by anywhere from 41-116%. US research firm Catalyst found in its report ‘The Bottom Line: Corporate Performance and Women’s Representation of Boards’ that companies with a higher representation of women board directors had better financial performance: • Return on Equity: On average, companies with the highest percentages of women board directors outperformed those with the least by 53%. • Return on Sales: On average, companies with the highest percentages of women board directors outperformed those with the least by 42%. • Return on Invested Capital: On average, companies with the highest percentages of women board directors outperformed those with the least by 66%. Across Europe, statistics have repeatedly shown that the labour force potential of women is not being adequately utilised: • Only 59% of women participate in the labour market as opposed to 70% of men. • Only 16% of board seats at Europe’s largest companies are filled by women. • On average, women earn 16% less than men.

■ RIB median revenue ■ ONS vacancies

15

-5 10 -15

Overall

Permanent

Temp

Contract

Deepening recovery Figure 1 shows that growth in median annualised revenue continued to accelerate in June to 4.7%, from 4.2% in May, and only 2.6% in April. (Note that the dip in March is due to the timing of Easter, which fell in March in 2013 and April in 2012, distorting the March comparison this year. Because we average revenue growth over three months, it evens out from April.) Clearly there is much stronger growth in the number of vacancies in the UK economy than in recruiters’ revenue, as in the current economic conditions companies are looking for alternative, and cheaper, alternatives to recruiters. Although the graph shows that the growth in the number of vacancies in whole economy fell back slightly to 12.1% in July from 12.9% in June, we are less concerned, as when the Office of National Statistics first reported the June figures it reported them as 12.1% – it upgraded the June figures when it reported the July figure. We will reserve judgement until we see next month’s data release. Meatloaf sang Two Out of Three Ain’t Bad, and June was the first month since February that two of the three recruiter revenue streams – permanent billings, temporary and contract billings – have simultaneously shown growth. Temporary is continuing to grow steadily, but permanent saw a remarkable turnaround, storming ahead to year-onyear median revenue of nearly 9%. We hope that this is a symptom of improving confidence among employers, which hitherto had been keeping flexibility in their workforce by relying more on temporary workers. Contract billings continue to struggle, down 6.9% in June, but there is at least an improving trend from the mid-teens contraction seen just two months previously. • Chris Ansell is chief financial officer at Recruitment Industry Benchmarking (RIB). The RIB Index provides bespoke confidential reports on industry trends. See www.ribindex.com; info@ribindex.com: 020 8544 9807. The RIB is a strategic partner of the REC.

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Getting ahead

The View

The REC’s monthly JobsOutlook report consistently shows that well over 90% of employers are satisfied with the work of their recruitment partners. As well as finding the right temporary and permanent staff, recruiters are going the extra mile in demonstrating their awareness of external developments and using this as a way of nurturing client relationships. The aim of the REC’s policy work is to not only influence the political debate but also provide members with the kind of ‘heads-up’ that will accelerate this trend.

It’s been an exciting summer, with jobs at the centre of attention over the holiday period. The opposition and the trade unions have sought to undermine our flexible labour market with stories first about zero hours, and then about foreign workers, as part of their campaign to fight what they call underemployment and casualisation. The REC, on behalf of members, the industry and business, has stood up and fought back with data, evidence and sound economic arguments. This included us getting our messages across extensively in the media. Far from making enemies, we have gone out of our way to make friends and influence people. Our core message is that our flexible and dynamic labour market is a huge competitive economic advantage for the UK and it maximises employment. For the most part, members don’t see this activity and quite often aren’t aware of the impact we have made on behalf of the industry. We are the people who prevent bad things happening before they occur, so that we maintain the appropriate regulatory climate. Our persuasive team of unsung heroes ensure members can focus on what they do best: helping clients find talent and getting people into jobs, while we quietly protect the industry’s back. At the moment, we are working with the government on ensuring the conduct regulation changes and the AWR review help, rather than hinder, the industry over the next few years. One part of this important work is getting our messages across in the media, so raising the profile and voice of the REC is critical. For a small trade association, we are making the voice of recruiters heard both in the corridors of power and in the living-rooms of the nation.

• You can follow Tom on Twitter www.twitter.com/@hadleyscomment

• You can follow Kevin on Twitter www.twitter.com/@KevinGreenREC

Tom Hadley, the REC’s director of policy and professional services, looks at how being ahead of the game on external policy developments can provide a ‘brand elevator’ for recruiters Diversity is an example of a policy issue that can create direct competitive advantage for recruiters. There are many others. Here are a few examples: • Inclusion: the recent Women in Recruitment event (see pages 4-5) focused on how leading edge recruitment practices can make a difference on the gender equality agenda. It also honed in on the business benefits for recruiters. Carol Rosati, director of CFO practice at Harvey Nash, made the point that “it provides a ‘brand elevator’ and enables us to open different conversations with clients”. • New working practices as a driver for new client relationships: the government continues to drive flexible work through legislation (not always the right way forward, in our view) and good practice ‘prompts’. Most businesses get it. The key is how to embed new working practices. One of the conclusions of the REC’s Flexible Work Commission was that recruiters have a central role to play, for example, by working with clients to review job designs and tap into the pool of highly skilled workers for whom flexible arrangements are a prerequisite. • Youth employment: working with clients to make things happen. The latest jobs figures confirmed that youth employment is set to remain at the top of the political ‘charts’. Our Youth Employment Taskforce and Charter have positioned the industry at the forefront of the debate. The focus has also been to raise awareness among REC members of apprenticeships and other government-funded schemes, and to promote the role that recruiters can play by working with clients to implement these initiatives.

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The Big Talking Point

Why women matter Francesca Steele looks at what’s causing the lack of women in the workplace from the classroom to the boardroom – and what can be done to fix it

“T

his is still a workplace designed by men for men. There is a great deal that this Government still has to do to make sure that we can allow women to play their full part.” These were the words spoken by Maria Miller, minister for women and equalities, when she gave evidence to the Business, Innovation and Skills Committee in January 2013. There is certainly no doubt

that great inequality between the two genders still exists in the workplace, from pay to promotions and from the classroom to the boardroom. For instance, on average women still earn 16% less than men, despite the fact that they are more likely to have achieved a higher-level qualification. With this in mind, in March the REC held a roundtable on ‘Recruiting for the

Top Tips from the REC Women in Recruitment Event “Being ahead of the game on diversity is a key part of promoting recruitment as a career” David Head, Recruitment International “Putting consultants through unconscious bias training has created a key differentiator for our business” Sue O’Brien, CEO, Norman Broadbent “The government’s aim is to drive change through the ‘Think, Act, Report’ initiative rather than through legislation and quotas. The recruitment industry has a key role to play in making change happen on gender equality in senior roles” Tim Morgan, Government Equalities Office “In a global market, we need to match globally diverse teams in order to work with the best clients and attract top talent. We need targets, not quotas, in order to move the agenda forward” Joanna Santinon, partner, EY (formerly Ernst & Young) “Diversity enables us to open different conversations with clients. It helps secure new business – it’s a ‘brand elevator’” “Some progress has been made at board level. The real challenge is to build the pipeline of future women leaders. Corporate culture is the main reason women choose not to stay and develop their career with an employer” Carol Rosati, Harvey Nash, Inspire co-founder “60% of people working in recruitment are women. However, we need more balance at CEO level” Anita Holbrow, director, REC

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Boardroom: Improving gender diversity in UK businesses’ and in July it held a conference on the ‘Role of Recruiters in Increasing Gender Diversity’. Recruiters, employers and policymakers convened to discuss not just the fact that equality can reap financial rewards, but just what the obstacles to greater diversity are and how business can overcome them. As Amanda Ciske, policy adviser, observes “Diversity is not a woman’s issue, it is a business issue.” (See our analysis of the figures on page 2.) Ms Ciske breaks down the causal factors into five main categories: 1)Male-biased business culture; 2)Caring responsibilities such as having a family; 3)Lack of confidence, networks, mentors and sponsors; 4)Conscious and unconscious bias and bad/outdated recruitment practices i.e. recycling job descriptions; and 5)Education and careers guidance She says: “It’s a very complex issue. But of course recruiters are often the first to recognise where there are skills gaps. It’s always a tricky thing to challenge a client’s perception, Heather Melville especially when

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The Truth About Flexible working John O’Sullivan, CEO of Ten2Two, a recruitment organisation that focuses on flexible roles, tells us how flexible working can reap rewards

Getty

There is more pressure now from the top down to be flexible in bigger companies. If you’re working with clients across different countries, the classic 9-5 in the office doesn’t work anymore, quite aside from the fact that many of these companies are beginning to realise they are losing women at senior management level.

many come in with an idea of their ideal candidate. However, it’s important for recruiters to trust their own authority and explain to clients where a different person, say a woman, or a different way of working, might be the better option.” One woman who knows this better than most is Heather Melville, a regional director in customer solutions at the Royal Bank of Scotland, and founder and global chair of the RBS Focused Women’s Network. “Things are getting better – when I set up the women’s network seven years ago, we were hidden. No one knew who we were. But seven years later and I have a budget for a global network, and 10,000 women in that network.” Women’s networks, says Melville, are an excellent place for recruiters and head-hunters to expand their searches. “It’s important that women develop the necessary skills, contacts and profiles for senior roles. I’m not really a big believer in quotas – what we need to focus on is the development stage. Women don’t like to tell people about their skills, but it’s very important for them to be able to speak confidently about them and to have an easily accessible online Sarah Thewlis

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profile. I also speak at events, which strengthens my reputation. Recruiters can both encourage that sort of development on behalf of the candidates and also point it out to clients.” Women’s networks can also, adds Ciske, ensure that women continue to feel connected to their workplace during maternity leave, without feeling a sense of obligation. Another important factor is the role of technology, which has allowed increasing numbers of women and men to work from home and to make flexible working a viable option (in the box to the right, John O’Sullivan tells us about the benefits of flexible working). Sarah Thewlis, who sits on the REC council and is managing director at Thewlis Graham Associates, says the issue will ease when there is a critical mass. “Going back to that quote about the workplace being designed for and by men, I think when there are more female role models, the perceptions will change, on everything from how to incorporate flexible working and how to appreciate female qualities to how to ensure that women get the training they need to compete. When companies truly realise that it’s not just about looking good but about improving their own business, then change will move rapidly.”

For a lot of people, it’s not about reducing hours so much as shifting those hours around. For instance, working from home several days a week gives the employee back the time that they would have spent commuting – this can amount to several hours a week, meaning that the employee can see their children, feel less stressed and still get the work done. Companies both big and small are beginning to realise just how important it is to retain good people, and that there are options that enable them to do so. There’s a big trend in the workplace at the moment where people are saying it’s not so much about long-term management as it is about how staff respond to new, unexpected situations. Women tend to do better at that, and also at bringing teams together. They also tend to be more loyal to an organisation. It can be more worthwhile financially to keep on someone who knows the business really well and can offer all those skills several days a week than to spend time and money training someone new just because they can work full-time. We worked with a marketing agency client which admitted it had recently made a big mistake. It had recruited a top account director from a big London agency, but tried to downplay the fact that she was there only three days a week, to the point that she left because she didn’t feel that flexible hours were really respected or acknowledged. But when the firm told the people on her accounts, they were furious, because they liked working with her. It’s the theory that scares people really, but if you can learn to communicate and organise your week properly, flexible working is not only a viable option – it can work better than the traditional model.

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Legal Update

Gender in the workplace: the legal low-down What you need to know about women in the workplace from an employment perspective There are a number of different pieces of legislation to consider when employing someone, but some have particular relevance for female workers. These include: • Equality Act 2010: Gender and pregnancy are two of the nine ‘protected characteristics’. Essentially, a woman should not be discriminated against on the basis of her gender or because she is pregnant or has recently given birth. Discrimination can be either direct or indirect. The former includes refusing to employ a woman or paying her less because she is a woman; the latter includes introducing conditions which disproportionately affect a group of people who share a protected characteristic. • Part Time Workers Regulations 2000: These apply to all workers and prohibit employers from discriminating against an individual because s/he works parttime. These regulations are not focused on female workers but impact more on women, as more women than men work part-time. • Certain obligations are placed on businesses when employing or engaging pregnant women – these include the requirement to carry out appropriate

risk assessments and implement any ny necessary action arising from those and obligations under the Agency Workers Regulations 2010. Proposed legislation Gender audits: Importantly, while employers might want to address a gender imbalance in their workforce, they cannot positively discriminate in favour of a woman if there is a more qualified male candidate. However, from January 2014, financial firms will have to set out how many men and women they wish to appoint to boardroom positions. Firms will also have to publish a diversity policy, explaining how they propose to create a more balanced workplace. Flexible working: In May 2011, BIS published the ‘Modern Workplaces’ consultation which proposed a more modern system of flexible working for all employees. The Children and Families Bill is still working its way through Parliament, but the proposed changes include: Shared parental leave: A key concern is that women drop out of the workplace following the birth of a child, and so the proposals aim to enable fathers to take a more active role in childcare. This is due to be implemented in 2015 and will

Maria Miller, minister for women and equalities enable qualifying parents to share 50 weeks’ statutory maternity leave and 37 weeks of statutory maternity pay. Parents will be able to take the leave concurrently tta or tto alternate throughout the maternity leave period. mate Flexible working to be extended to all employees in 2014: Similarly, the government is keen that flexible working is seen as a positive for all workers, and not as a female-only issue. The current statutory right to request to work flexibly applies only to certain qualifying employees who are the parent of, or have parental responsibility for, a child aged under 17 (or of a disabled child aged under 18). This right to make a request will be extended to all employees. Employers will be required to deal with requests in a reasonable manner and within a ‘reasonable’ period of time. A new statutory code of practice will be created for employers to give guidance on the meaning of ‘reasonable’ and on how to deal with conflicting requests. REC Corporate members can obtain further details from the REC legal guide at: www.rec.uk.com/legal_guide • Lewina Farrell, Solicitor and Laura Nichols, Legal Services Executive – REC legal team

Business development: Health check-up Recruiters know better than anyone what amounts to a good deal in terms of benefits. The Private Health Partnership is one of the UK’s leading healthcare intermediaries and the REC’s endorsed intermediary for the provision of health and wellbeing benefits, including private medical insurance. It is currently relaunching a range of bespoke health services and benefits not available anywhere else, that it claims is perfectly suited to recruitment companies. Richard Gould, head of business development, says that on average the Private Health Partnership has saved REC members 24% on healthcare premiums (based on data samples taken between 1 March 2012 and 28 February 2013).

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“We save people time by reviewing the market for free (we don’t charge fees), administering our package throughout the year and offering access to bespoke products. Attracting and retaining top-quality staff remains a priority for all good businesses. But many are leaner than they once were, or at least more prudent, than they once were,” he says. PHP is currently expanding to source healthcare for international clients. “If recruiters who have a package with us are placing candidates abroad, this means we can also help them and their clients find the right package for them,” adds Gould. • For more information on what PHP could do for you or your business, go to www.php.co.uk

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Inspiration

This month, the IRP reveals the results of its survey taking a look at a day in the life of a recruiter A lot can happen in a recruiters day... Advancing the recruitment profession

On average a recruiter needs 31/2 cups of tea or coffee to get through the day

‘‘

VARIED

When you work hard it pays off, and when it pays off you have fun!

PRODUCTIVE

Why do they keep recruiting?

Like helping people find the job they love Got into recruitment to work with people Love to help clients find the best candidates Think working with people matters most

‘‘

I love not knowing what your day holds.

PROGRESSIVE

WORK

EXCITING

COMPETITIVE THRILLING ‘‘

69% Salary and benefits 20% Helping people find the right job 29% 19%

Buzz and adrenaline Career progression

‘‘

20%

48%

For the love of recruitment

19%

Top 5 favourite snacks

13%

If I wasn’t a recruiter... Rock Star

Pro Golfer

32%

21%

20%

13%

13%

Footballer Driver

SOCIAL

SOURCE: IRP 2013 | Infographic by www.jg-creative.co.uk

Astronaut

DEMANDING

SATISFYING

46%

of recruiters have worked in recruitment for up to 5 years

ENJOYABLE UNPREDICTABLE

www.rec-irp.uk.com/iloverecruitment | info@rec.uk.com

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Artist

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Events and training

The new REC Audited standard How well do you know your business? The new REC Audited standard goes way beyond compliance issues. It requires recruitment agencies to demonstrate that they operate best practice in areas such as customer service, staff development, diversity and client management. And, as two recent advocates who we speak to below demonstrate, it offers you the chance not so much to spot problems as to find ways to improve, so that you can keep growing your business. Clive Parker, of Apollo Recruitment, says: “We’ve been corporate members of the REC for a long time, but I only recently realised just how fantastic all the resources are. Before we had an online annual assessment to maintain registration but with the new audit, we thought: what a great opportunity to appraise where we are at. The online test you do before the main audit is a good chance to refresh your training and then go through every piece of documentation in the company. That part did take about six months on and off so it was a bit of work, but it was completely worth it. For instance, the REC has templates so that you can check that all the letters your business sends out are compliant. I actually think the online pre-audit assessment tool is so good that the REC should go into producing e-learning training modules.” Simone Payne, of 4myschools, says: “The online diagnostic that you have to complete before the audit proper begins took about an hour to complete. It had about 100 questions, was multiple-choice and tested my knowledge of my sector, looking at everything from legislation to conduct regulations, questions on business regulations, immigration – everything! I did find it challenging, but in a really good way. I then got feedback, which told me areas I could improve in, and it allowed the auditors a snapshot of our business before they arrived. The main audit took a day, and the main difference between the new and the old standard was that they asked to see our policies, ensuring that we had equality and customer service policies and so on. The whole thing helped us firm up our business practices and see where we could improve. I think it’s essential for our

Recruitment Matters The official magazine of The Recruitment and Employment Confederation Dorset House, 1st Floor, 27-45 Stamford Street, London SE1 9NT Tel: 020 7009 2100 www.rec.uk.com

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Clive Parker, left receives the new REC Audited standard

industry to be self-regulating, and the REC is the right place to be doing this audit because they really understand the sector. It’s not about passing or failing. It’s about support.” • To find out more about REC Audited, or to book, call your account manager today on 020 7009 2100 or email info@ rec.uk.com.

Recruitment Agency Expo 2-3 October 2013, Birmingham The Recruitment Agency Expo is the must-attend event for professional business leaders responsible for development, growth and strategy in today’s challenging economic environment. With over 50 exhibitors, 28 seminars, 14 training sessions and a host of exhibitor presentations, demos and training sessions, the event offers everything you need to make informed decisions quickly and efficiently. It’s the most comprehensive recruitment industry event of the year. Come and visit us at stand A13. • For more information and to register for your free place, visit www. recruitmentagencyexpo.com/birmingham

Membership Department: Membership: 020 7009 2100, Customer Services: 020 7009 2100 Publishers: Redactive Publishing Ltd, 17 Britton Street, London EC1M 5TP. Tel: 020 7880 6200. www.redactive.co.uk Publisher: Anne Sadler anne.sadler@redactive.co.uk Tel: 020 7880 6213 Consulting Editor: Ed Sexton ed.sexton@rec.uk.com Editorial: Editor: Francesca Steele francesca.steele@redactive.co.uk. Production Editor: Vanessa Townsend Production: Deputy Production Manager: Kieran Tobin. kieran.tobin@redactive.co.uk Tel: 020 7880 6240 Printing: Printed by Southernprint © 2013 Recruitment Matters. Although every effort is made to ensure accuracy, neither REC, Redactive Publishing Ltd nor the authors can accept liability for errors or omissions. Views expressed in the magazine are not necessarily those of the REC or Redactive Publishing Ltd. No responsibility can be accepted for unsolicited manuscripts or transparencies. No reproduction in whole or part without written permission.

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RM Sept 2013  

Recruitment Matters, September 2013 issue