Demand for interim managers jumps 22 percent bucking trends in the wider senior management recruitment market with a surge in demand driven by financial services sector, now 43 percent of all new demand.
Demand for interim managers has increased by 22 percent in the three months to September 30 2011 bucking the otherwise lacklustre jobs market for senior executives and directors, says Interim Partners, the number one provider of interim managers to the private sector. Research by Ipsos MORI for the Interim Management Association identified 526 new interim management assignments that started in Q3 2011 compared to the 431 that started in Q2 2011.
Interim Partners says that the number of new assignments given to interims is at its highest level since the third quarter of 2009. Interim executives are senior executives, usually just below board-level, who are recruited on a short term basis. Interim managers earn as much as £1,000-£2,000 per day. Interim Partners says that demand is being driven by businesses that have gaps in their senior management teams but feel that the weak economic outlook makes it too risky for them to make full time hires.
Doug Baird, Managing Director of Interim Partners, says that some of these new appointments of interims are a very specific response to the Eurozone crisis – the interims are being hired to help downsize organisations which now fear that they face a longer period of slow economic growth. Doug Baird comments: “Businesses are already taking steps to respond to the Eurozone crisis by trying to become as lean as they can. That is creating demand for interims with experience of going into a businesses and taking out any non-core costs in a way that has the least possible impact on customers and staff morale.”
The research shows that 43 percent of all interims in the third quarter 2011 were placed in the banking and financial services sector. This is the highest level since the first quarter of 2010. At the start of 2009 just 25 percent of new interims were in the banking and financial services sector. Andrew McIntee, Director of Financial Services at Interim Partners, comments: “One new area of demand is for those interims that have the experience to help banks work through the restructuring of their large portfolios of distressed debt. They are assisting banks both in the sale of books of loans and in helping ensure that the banks can recover the most that they can out of a borrower that has defaulted.”
Interim Partners points out that the tighter regulatory scrutiny from the FSA is also creating demand for interim executives. Andrew McIntee adds: “Businesses are bringing in interims to help review and improve their systems and controls in light of a regulatory clamp down by the FSA.”
“Interims have the advantage of offering an objective perspective on the business, which can help to identify weaknesses that permanent staff are too close to see.” Interim Partners says that retail banks and insurance companies are also turning to interim managers to manage integration and divestment projects and regulatory change.
Andrew McIntee explains: “Insurers are bracing themselves for the impact of Solvency II, which is due to come into force in January 2014. Many are hiring interims to assess what lines of business will carry higher costs so they can make a strategic decision about which lines of business to focus on.” “The most sought after interims are the ones with proven experience who have already delivered a Solvency II project for another insurer. Insurers are willing to pay very good rates for interims with this kind of experience.”
Adds Andrew McIntee: “Retail banks have been heavy users of interims since the credit crunch to manage integration projects following large scale mergers. Divestment programmes by large banks are now picking up pace and that’s been a big source of new demand for interims in the second of half of 2011.”
