2020 really was a year to consign without regret to the history books. Throughout last year, we tracked the state of our industry as it rode the Covid waves of lockdowns and redundancies.

It’s fair to say that our barometer from the summer of 2020 indicated a sense of uncertainty about an impending second wave which has unfortunately since been realised and continues to surge relentlessly. That’s not to say however that it’s all been doom and gloom in recruitment since the summer.

From our position now, we’re able to look back at the final months of 2020 and highlight some positive hiring trends, providing, we hope, some much-needed optimism for 2021.

Technology-led sectors thrive in a challenging year

We’ve taken a deep dive into the sectors which managed to buck the trend and thrive in 2020 in order to identify the differentiating factors that have led to success. It comes as no surprise that the healthtech sector led the way last year, but it isn’t the only one; we spotted resilience in other industries such as financial services, eCommerce, edtech (organisations providing homeschooling support platforms were obviously particularly successful) and utility-focussed SaaS companies, and this has been reflected in their continued hiring activity, for example in engineering and design disciplines.

It’s clear that the ability to pivot quickly in commercial strategy has been the difference between success and failure for many organisations. Toby Thwaites, Associate Director Design & Creative, said:

“The businesses that have really struggled are the ones with nowhere to go, for obvious reasons, such as travel or traditional bricks and mortar retail.”

 

Confidence in technology continued to grow last year, no longer playing a supporting role for businesses but instead now a critical component in keeping them going in remote working conditions. According to our Technical Recruitment Team Lead, Rohan Maheswaran, tech businesses generally continued to push on with existing roadmaps and product development as the year went on, thanks in part to two key factors.

“Technology has been viewed as a solution to challenges presented by Covid for lots of businesses, so investment in strengthening or scaling this area has gradually built. Secondly, technical work can often be delivered from any location so lockdown 2 has had less of a negative impact unless it crossed over into obvious sectors such as travel or hospitality, ” he said.

 

Hiring swing from Lockdown 1 to Lockdown 2

From conversations with both clients and candidates in our network, there is no doubt the industry saw a distinct swing in market conditions between the spring and late autumn. Our Client Director Jon Wall believes that we experienced a client-driven market in Lockdown 1, fuelled by a scarcity of jobs and an excess of candidates as a result of waves of redundancies.

“In Lockdown 2, we’ve seen far more of a candidate-driven market. There are more permanent jobs available and less candidates willing to switch, cautious about leaving a secure role,” he said.

 

Echoing Jon’s observations, numbers clearly show that permanent hiring moved from bare essentials earlier in the year to a more consistent flow across the market as 2021 dawned. The contract market also had a particularly tough time last year with rates diminishing across the board and competition being greater during the first lockdown, but we finally saw significant improvement in the last quarter of the year with levels starting to resemble those from pre-Covid months.

Toby Thwaites certainly agrees that the second lockdown had far less of an impact on hiring. He said:

“I’ve observed a fairly normal balance of businesses hiring well directly (just as in pre-Covid times) as well as many looking for specialist support from us – I’d say in both cases, the number of requirements picked-up in late summer. For example, one business on a hiring freeze in Q2 due to Covid has made four Design hires since late Summer.”

 

Interestingly, we may well see some long lasting positive changes within recruitment as a direct result of Covid. The remote hiring processes, for example, put in place out of necessity earlier in the year may permanently replace more traditional interview approaches as we move into 2021 thanks to their increased efficiencies – more streamlined processes are here to stay, and that’s certainly a good thing.

Social purpose and flexibility top the list for candidate requirements

It goes without saying that companies have had to adapt how they work with their employees on a more flexible and remote-working basis, and this is now working firmly to the advantage of candidates, particularly outside of London. Toby Thwaites said:

“For us, it’s been great to engage with the design community outside of London, or even the UK, who are now more readily being given the opportunity to support our clients remotely.”

 

The new flexibility to work remotely was certainly one of the stand-out features of 2020, and in the final quarter of the year, we still saw no clear sign of any return to pre-Covid office norms, particularly in our disciplines – design, technology and the like – where ‘working from anywhere’ can be just as effective.

Alongside flexibility, we noticed a fascinating increase in candidates wanting to work in companies with greater social impact and value – tech for good, for example – in a notable purpose-driven move. Similarly, as Jon Wall notes, candidates now place even greater importance on wanting to know that clients are delivering services in a ‘respectful and ethical’ way. Nowhere has this been more relevant than in the healthcare sector, but it comes with distinct industry-specific challenges which candidates should be aware of.

“In many healthtech companies, they are working hard to get the balance right between commercial objectives, guided and restricted by tight regulations, and purpose. Many individuals join these companies due to the purpose, the opportunity to make a positive impact on patient lives, but often find in reality that the commercial and regulatory considerations create pressure on product teams to deliver within challenging timescales. It can be unsettling for teams,” he said.

 

Post-Brexit life and IR35 changes loom large in 2021

With all attention currently focussed on Covid-19 and the first few weeks post-Brexit, it’s easy to forget that changes in IR35 regulations are still due to come into effect in April 2021 after being postponed for a year in 2020. It’s something that we’re keeping a close eye on but as with most things at the moment, there are no guarantees. Toby Thwaites said:

“As far as we know, IR35 is still going ahead as planned and we are working closely with our contractors and clients so that everyone is well prepared.”

 

Brexit however is of course now a done deal and we’re already seeing its impact on employment and recruitment in the tech industry due to the high levels of tech talent originally from the EU working in the UK. While most people in this position have already applied or are in the process of securing settled status, many employers and employees alike are still searching for guidance on the issues and this is likely to continue as a real focus early in 2021. Rohan Maheswaran said:

“Tech roles will inevitably continue to be in demand, but it could be challenging if there are limitations placed on hiring certain niche skill sets within the existing talent pool. As a result, we could see a couple of things happen – firstly, more junior hires and greater progression opportunities to fill the demand gap, and secondly increased scope for individuals to cross-train and upskill. Similarly, there will likely be an increase in salaries or rates, and more companies incentivised to create more sponsorship opportunities for EU workers.”

 

Optimism rings out for 2021

2020 certainly left its mark and many changes brought about last year will likely stick around. We have found that the needs of our clients across almost every industry have changed and still continue to do so, and as a recruitment team, we need to adapt and keep pace. Open channels of communication and a far higher level of empathy than we’ve seen previously will be vital for both candidates and clients alike. Jon Wall said:

“More than ever, there is value in really connecting with candidates as people – they are making decisions on career moves that are now more than ever driven by a wide range of personal and professional considerations.”

 

Despite ongoing uncertainty around Covid, post-EU life and IR35 among others, there is still a general sense of optimism among our consultants and their wider networks. The development and roll out of two Covid vaccines has opened up the possibility of a credible ‘exit plan’ from the pandemic, the furlough scheme has been extended until the spring and there is reason to believe that life may begin to return to some semblance of new normal this year. As Rohan Maheswaran put it:

“There is the chance to make hay on a lot of the plans that were continually pushed back in 2020 because of Covid.”

 

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