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Episode 70
191 Plays5 months ago
News for the week beginning 15 July 2024 and Question of the Week: "How important is the reputation of the owner or MD of a recruitment agency?"
#RNA #RecruitmentPodcast #RecruitmentNewsAustralia
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Transcript
Hays ANZ's Declining Fees
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Speaker
This is the news for recommencing the 15th of July 2024. I'm Adele last. Hayes ANZ net fees fell by 22% in the June 2024 quarter compared to the June 23 quarter according to results released last Thursday. Temp net fees decreased by 16% with PERM down 32%. Private sector fees decreased by 23% with the public sector down 19%. By country, Hayes Australian net fees decreased by 20% and New Zealand dropped by 43%. By region, New South Wales decreased by 25%, Victoria by 18%, Queensland by 16, ACT by 21% and Western Australia fell by 14%. At the ANZ Specialism level, construction and property decreased by 23%, IT fell by 19%, accounting and finance decreased by 21% and HR by 25%.
00:01:05
Speaker
Global net fees decreased by 15% and its fiscal 4th quarter results ending 30 June on a like for like basis with temporary and contracting fees decreased by 12%. Consultant headcount decreased by 5% in the quarter and by 18% over the year. A
Principal Salaries Debate
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Speaker
leak of confidential data has revealed the average pay for the principal of a large private school in Sydney is about $687,000 a year. At least four principals receive a salary and benefits package worth over $900,000, with one principal receiving more than $1 million dollars a year. The salaries of New South Wales public school principals range between $140,000 and $216,000 per annum.
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SEEK puts the average pay for a school principal in Australia between $165,000 $185,000 per annum. By comparison, the Prime Minister Anthony Albanese receives just under $550,000 per annum. The matter of private school leadership salaries has become topical as the New South Wales government is poised to release the results into its review of Section 83C of the Education Act 1990. which outlines what private schools can and cannot do if they want to operate as a not-for-profit organisation. According to the Act, all pay packages required for the operation of the school be it no more than reasonable market value and not be in any other way unreasonable as a condition of receiving public money. The New South Wales government
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can adopt the Queensland Government policy which requires private schools to table annual reports in the State Parliament including details of teachers' remuneration packages. Critics of the pay rates of New South Wales private school principals are looking forward to the government asking private schools why they need to pay around three times as much to attract a principal compared to a public school. Hundreds of government
NSW Public Service Cuts
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jobs in New South Wales are set to be slashed in the first of several expected restructures of the state's public service. The New South Wales government is Australia's largest employer with a headcount of over 450,000 people as of 2023. Now amid a budgetary crisis and enormous inherited debt and long-term economic uncertainty, the government is preparing to enact a raft of measures to trim the public service. Service New South Wales, the mega department responsible for everything from car registration and births, deaths and marriages to natural disaster emergency assistance
00:03:38
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is the first to undergo a major restructure that will slash its huge headcount. Service NSW currently employs about 4,950 staff, almost double the number just before the COVID-19 pandemic. This is not sustainable as spokespersons did. During the last state election, Labor campaigned on a platform of efficiencies, including slashing the number of senior executive roles across all departments by 15%. It also pledged to take a knife to labour hire workers and recruitment agency contractor roles in the public service, reducing that headcount by 25%. The number of full-time roles in the NSW public sector last year increased by 4.7% compared to 2022 with more than 17,000 people hired in just 12 months. The median salary was $95,984. The government insists the restructure won't impact frontline customer service.
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The Australian
APS Employment Services Takeover
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Public Service will soon take more control over employment services after a parliamentary committee found the Workforce Australia network fails to meet everyone's needs. The federal government has responded to the House Select Committee on Workforce Australia Employment Services final report into Rebuilding Employment Services, which was tabled late last year. The government appears to strongly agree with the committee's view that workforce Australia employment services do not meet the needs of all people and employers who use it and that we need to do better. Workforce Australia is a network of private and community organisations contracted and funded by the federal government through the Department of Employment and Workplace Relations to deliver employment services to job seekers on support payments. The committee's call for a review is being taken seriously with the government now considering a greater stewardship role for the Australian Public Service in employment services.
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The government has considered the views of the Select Committee and agrees that reform is necessary, its response states. Employment Minister Tony Burke has agreed that major reforms are required. Employment services should play a key role in creating opportunities for people to earn and get ahead, Mr. Burke said. As the House Select Committee found, the system works for some people, but not for others. It's like an emergency room that treats every patient the same way. This one size fits all approach doesn't work. It will take time to design and implement large scale reform, Mr Burke explained, but some immediate improvements are already in train. According to
OECD Wage Report
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a new OECD report, Australia is one of only four countries where cuts in real pay, pay adjusted for inflation, have been more severe for low paid workers than those on higher salaries. The OECD's latest employment outlook 2024 reports that real wages are lower today in 16
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of the 35 countries compared to the period immediately before the pandemic. Australia's real wages are 4.8% lower than pre-pandemic levels, while across the OECD real wages over the same period have risen 1.5% on average. Lithuania, Estonia and Hungary were the other countries whose real pay declines have been more impactful for lower paid workers than for high paid workers. London
Page Group's Profit Decline
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listed global recruitment company Page Group reported last week the second quarter gross profit declined by 12% on a constant currency basis compared to a year ago. Page Group said in its trading update that it continued to see tough conditions in many of its markets with no immediate signs of improvement. Page Group in Asia Pacific accounting for 14% of global gross profit reported the largest decline of the company's four regions with gross profit for Q2 down 19.8% year over year.
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32.3 million pounds. Greater China declined 29% in the second quarter, Japan declined 6%, and Page Group Australia declined 38% compared to the June quarter last year. India continued to deliver standout results for Page Group globally with a record second quarter up 7% on the prior year. 6 June employment market update reported a 1.5% month on month and a 17.1% year on year fall in jobs advertised. All states and territories recorded a month on month decline with the ACT down 5.1% and Tasmania down 3.9% recording the largest falls. New South Wales dropped 0.4% and Victoria 2.2%.
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By sector, the largest job ad volume month on month falls were in hospitality and tourism at 8.1% drop and education and training a 5.4% decline. On a year on year basis, the IT sector recorded the largest sector decline at 30%. Applications per job ad recorded a 3% month on month rise. Staffing industry analysts assess 241 staffing firms as having at least 100 million US dollars in US revenue in 2023, according to the largest staffing firms in the United States, 2024 update report released last week. The firms listed in the report generated $145.2 billion dollars in US staffing revenue down from $168.8 billion dollars in last year's report. The five largest US staffing firms by revenue are, one, Allegious Group, 5.3% market share, two, AYA Healthcare, 4.7%,
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three, Randstead 2.4%, four, Express Employment Professionals at 2.1% and in fifth place, Insight Global at 2% market share. Healthcare and IT temporary staffing were the most common primary revenue segments with 29% of the firms reporting either of those segments as their largest. Industrial staffing followed at 24%. Conversely, Office and Clerical Temporary Staffing was the largest segment for only five firms. or 2% of the 241 companies.
FTC Non-Compete Clause Legal Battle
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The fate of a ban on non-compete clauses in the United States remains in flux after a federal judge granted an injunction in a suit brought by key business groups. The Federal Trade Commission announced a sweeping ban this April on non-compete agreements or clauses in employment contracts restricting staff from leaving their jobs to work for competitors or start their own business for a certain amount of time.
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Major business groups, including the US Chamber of Commerce filed suit against the FTC right after the rule was released. US District Judge Ada Brown in Texas wrote in her injunction last week that the FTC overstepped its authority issuing the ban. Judge Brown said she would issue a final ruling before the ban takes effect on September 4. And that's the news for the week beginning the 15th of July 2024. I'm Ross Clennett.
Impact of CEO Reputation on Recruitment
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Question of the week, how important is the reputation of the owner or managing director of a recruitment agency? Adele, what do you think? Great question, Ross. And obviously with recent events in relation to a very prominent CEO in our industry, Collar Recruitment, or everybody will probably know the story now, of course, around Ephraim Stevenson's um situation with the business and you know a voluntary administration and now the vote and the re-control set back to him. It's a really, really interesting case in our industry around when the reputation of the owner has an impact so on on an agency. and and no We'll talk a little bit more about that particular case, but I think it's really important. There are lots of good examples of this, lots of agencies that I believe have very strong
00:11:37
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or interesting or however you'd like to describe the CEO at the head of organizations. And I'm talking mostly privately owned organizations because the CEO or founder or owner seems to have a a great impact there. But there's some great examples. you know One that comes to mind for me is you know Matt Sampson at Aspect Personnel who started the business himself, has a really great story around that. But you don't see a lot about Matt Sampson. You see a lot about Aspect. you know It's a lot about the business and the brand. and Obviously, it comes from his cultural influence and it comes from what he set up and how he runs the business and drives the business. But he isn't putting himself at the center of that's the reason the business is successful. and I think that's a really interesting model.
00:12:32
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It's quite similar to Steve Carter at Sharpen Carter. Now to my knowledge, Sharpen Carter have never submitted for an industry award. I've certainly never seen Steve at any industry awards night. And I don't see Steve Carter's name prominent in Sharpen Carter LinkedIn posts. And yet Sharpen Carter is certainly one of the most successful mid market to executive level recruitment businesses in Australia with over, I think now, over 100 staff. So that's quite different to the approach of, say, when Greg Savage took over A Quint when they were just a tiny business in Australia and Greg then leveraged his reputation through social media. And he was quite
00:13:25
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um straightforward about it. I mean, I've heard him speak where he said, you know, personally, I don't necessarily want to do it for myself. But he said, I know it helps the brand that when I build the A-Quent brand via my um posts and my blogs and everything else I do, it helps attract clients, it helps attract candidates, and it also helps attract consultants. And he kept doing it. because it worked. but of course That's the difference too, though, around the fact that like Greg's a good example where the content was still very work and professional related. it It wasn't necessarily about Greg. You know, it wasn't about him personally. It wasn't about him patting his own back. It was about how his profile could raise the profile of the company. Is that the key to this, that there's
00:14:22
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You've got to be really careful to run the line versus between the person and the persona versus the brand. Mm hmm. Agree. And this is where I think you need to have um a proper marketing strategy. So it needs to be thought through. This is where you need marketing expertise to help the owner or owners work out well, what focus we putting on the person versus the company. And how do we do that? Because there is a fine line to trade because if you've got a dynamic
00:14:56
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front person like Greg, then clearly his pronouncements are going to be of interest. And his brand certainly initially was much bigger than the A Quint brand. Well, you know, Greg's brand is one of the biggest personal brands in the Australian recruitment industry. So why wouldn't you do that? I mean, it certainly, certainly worked for him. But of course, then what happens when he leaves, you know, Greg, then effectively sold back the A Quint or Firebrand business to A Quint and he departs and then you have Simon Lusty and then he went off to A Quint US and
00:15:36
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A-Quent in Australia now, are well, certainly in in in my eyes, a much lower profile brand. Now I'm not in that sector, so maybe it doesn't matter that people like myself don't know as much about them, because if A-Quent in the market that their candidates and clients are in still have the same profile, well, that's you know probably all that matters. There is a flip side to this, and you mentioned marketing strategy, and and there is a real a strategy and focus for some marketing professionals around um making the personal brand part of the cultural brand. you know They see social media being social. It's about people. it's It's what really bites. And we know that. We know when people make posts of a personal nature, they're of more interest to us. We're humans. We want to learn about other people. So ah you know I get that the reason why people would perhaps put a CEO out front and center and put their reputation out
00:16:35
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further in front than the brand of the business.
Collar Recruitment's Leadership Challenges
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But looping back to caller recruitment, I mean, we're just seeing where it's just gone horribly wrong. Well, of course, it's the contrast, isn't it? Before voluntary administration, Ephraim was on LinkedIn and other platforms, continually promoting the things he was doing, promoting Collar Group, all well and good, but of course, subsequent to voluntary administration in late May, pretty much nothing. And now the business is going through the process of being returned to his control. It's been weeks and there's still nothing. Now, I appreciate that he's got to get all of the internal stuff sorted, but
00:17:27
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This is the risk. When you have such a large profile via social media and something goes wrong, and you're the front person for the business, then there is associated collateral damage. And Collar Group, frankly, I don't think is ever going to recover while Stevenson is in charge. Nothing against Ephraim personally, but it's just the association and certainly the fairly strong negative publicity that he's received about communication or lack of it in terms of many heads being cut at Collar and just the whole process of returning the control of the group to himself. Yeah, I think you're right. The contrast between the silence now, you know, having gone from such a very vocal marketing machine, very self promoting of himself and and what he was doing and most, you know, most posts you can go back through his LinkedIn profile and have a good look through. But the contrast to that of the absolute silence now, the absolute lack of any communication at all, whether that's just to say, hey, I'm back in business as usual, whether he doesn't want to say anything about it, obviously the way he conducts himself is his own business. But to say nothing, I think is really telling to to have no public
00:18:50
Speaker
communication out there. Perhaps he's communicating internally with his own staff. Let's hope that is the case and let's hope he's um building his own reputation internally. But I agree with you that external damage is so vast that he needs to come out and say something. Something needs to be said, I think, publicly. You know, there's there's been no humility through this process. there's been There's been nothing. There's been no voice. And I don't know whether that's his strategy that he thinks, if I say nothing, it's better. But yeah, I can't help but think the silence is is really damning. It's a really difficult situation to come back from anyway. And the longer he says nothing, nothing I think the worse it is. Well, this is where having proper marketing and PR advice is absolutely critical because the great thing about recruitment agency owners, or most of them, is that they are extroverts. They are people who are prepared to get on the front foot.
00:19:49
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But the downside is they probably, in my experience, tend to be very circumstantial, very reactive. Like they don't generally discipline themselves with a marketing plan or a PR ah plan. I think that's where, say, someone like Mark Smith at People to People has done a really good job. He has invested in marketing resources. He's got internal resources. He's got a very strong brand plan. Well, Mark and his co-directors, and Mark is an important part of that. But if you see Mark's postings on social media, it's all about promoting various aspects of people to people. It's not really about him per se. Yes, I guess the answer to our question, how important is the reputation of an owner or MD and of an agency
00:20:39
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It's very important. We're saying it is important, but get the expert advice that you need. Go and seek out people that will actually be able to run a filter over this because it is so critical to how your business is perceived, whether that's with clients, candidates, staff, and you know the ongoing success and future of your brand. No doubt. and And I'm very glad that I took that advice. Not that I obviously run a recruitment agency anymore, but before I started on my blogging campaign back in 2007, I sought the expertise of a marketing coach and he gave me fantastic advice and asked me great questions about the reputation I wanted to build and those
00:21:21
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um foundational pieces of my personal brand are still the same 17 years later and I'm very grateful that I made that investment and I got expert advice. We'll wait to see what happens next with Collar.
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To stay up to date with every episode of Recruitment News Australia, subscribe via our website recruitmentnewsaustralia.com.au, follow our LinkedIn page, Recruitment News Australia, and subscribe via your favourite podcast app. For more details about my services, simply go to rossclenet.com. And for more information about what's happening on my desk, you can visit careerlassoo.com. or the captainstable dot.com.au website.