Posts Tagged 'recession'

Global War for Talent in a Recession!

There’s a war going on right but do you know which side you are on? It’s not your ordinary war either so you can forget about sergeants, missiles and choppers and climb out your bunkers. This war is a global corporate and region war. The War for Talent!

According to a yearlong study conducted by McKinsey Co., the most important corporate resource over the next 20 years will be talent. It’s also the resource in shortest supply.

Now it may seem strange to be talking about the War for Talent in the midst of a recession but this recession in the grander scheme of things is likely to be a short term phenomenon and in the long-term in the Oracle IT sector there is still going to be the need for professionals on a large scale.

37% of IT professionals have admitted that once the recession is over they will be seeking a move, so what are current employers doing to make sure that when the recession is over that they will be able to keep hold of their staff?

War for Talent

In an attempt to deal with this problem before it arises, the European Union recently approved the Blue Card program, which is basically the same as the US Green Card System. The Blue Card (named for the colour of the EU’s flag) will allow skilled foreign workers to work and live anywhere in the EU’s 27 member countries.

55% of highly skilled immigrants head for the United States and only 5% to Europe. With the Blue Card, the EU hopes to dramatically change this imbalance.

So the European market is set for increased worker competition and when you combine the Blue Card system with the Intra-company transfer system which allows workers into the country without going through the same checks under immigration rules you can see how the competition for jobs and for talent in the future is going to be critical.

Unfortunately, the Intra-company transfer system has had the side effect of generating a number of dodgy companies from abroad claiming that they are consultancies but in effect are supplying workers in an agency format and paying those workers about 50% of what the standard rate of pay is for the type of work that they are doing. Also these companies will then hold on to a workers work permit restricting their ability to work elsewhere.

In the long-term this piece of legislation would have been beneficial to business as they would’ve still been able to find, “difficult to find”, talent to deliver their projects however with the unforeseen recession upon us the short-term effect is now over competition for jobs which is artificially driving down contractor rates.

This is probably what free trade and free movement of labour is all about and I am sure most Oracle IT professionals know it’s fair game if there’s someone out there who can do the job better then they can for cheaper. But with these companies masquerading as consultancies now supplying Oracle IT workers at stupidly low prices for consultants who only got into the country because of a loop hole in legislation I expect for some professionals this is a bitter pill to swallow.

This is in effect a similar scenario to where you are trying to sell your own car and a thief steals a car that is exactly the same model as your own car and puts their car on the market at half the price of your car. Leaving you with a choice of either to drop the asking price for your car or do not sell your car. This is the exact situation that certain contractors are experiencing here in Europe and especially within the UK.

Narrowing down this issue even more I know of one particular consultancy that is delivering a project to a central government operation in the UK. Now in attempt to drive costs down and maximise their profit margin, they have outsourced the Oracle Financials part of this implementation to another so called consultancy. This so called consultancy has no history of delivering projects but can get their hands on resources and transfer them internally to the UK and will then supply Oracle Financials Functional Consultants for an all inclusive rate of £210 per day. This is at a time when your average Oracle Financials Functional Consultant would normally expect around £500 per day. Even if the current consultants wanted to drop their rate by £200 per day to say £300 per day which many of them wouldn’t. They would still cost £90 per day more and that is even before the agency has included it’s margin. I can assure you this is horrible and has led to many uncomfortable conversations.

Hopefully this gets resolved and the government does something to cover up these loop holes. There are plenty of excellent Oracle professionals all over the world and if things are done right the global war for talent can be a win-win situation for everyone.

Oracle Retail Market Recovery

Most contractors will tell you that in the past 12 months the contract market has taken a battering. As end clients have down-sized their teams or delayed projects this has recently led to a temporary excess in talent in the market which has had the knock-on effect of driving down rates for contractors by as much as 33%.

Well the good news is that the worst days seem to be behind us. That is if we are to believe this recession is a “V” type recession and not a “W” type recession.

According to Apsco, Association of Professional Staffing Companies, The US staffing market will resume growth by 2010, following an unprecedented 26% fall in turnover in a single year (from a turnover of $126 billion in 2008 to $93 billion in 2009). However, the long term outlook for the US staffing industry is highly positive, APSCo delegates were told, with growth of 18.9% forecast from 2006-16, significantly above the average growth rate of 10.4% for all sectors of the economy.

Combine the above press release with the research in the UK from KPMG and the Recruitment and Employment Confederation (REC) whom found “marginal increases” in appointments in August. Things are looking positive for professional jobseekers across the globe. However, before contractors go and add 50% to your current daily rate and jump back into the job market pleading your worth. The research also added that it was too early to say whether the encouraging figures signalled an end to the recession.

The good news is that with France, Germany and Japan recently officially announcing the end to their recessions. There is a definite feeling that employers are beginning to have more confidence in their hiring plans and committing to their recruitment and growth plans. In the UK for example, Britain’s employers are reporting improved recruitment plans for the first time in three years, offering a “glimmer of hope” to jobseekers that next year promises to be a good year for contractors.

Also at Origin Forward our recruitment team has seen a 33% increase in job orders in the past month alone in the Oracle Retail global market. With opportunities arising in both the permanent and contract markets in countries across the globe from the UAE, United States, Netherlands, South Africa, India, Australia, China as well as the UK and Ireland.

The global recession has effected the Oracle Retail market hugely in the past 12 months. The Oracle Retail product is such a niche product with a limited amount of professionals and it is quite common for professionals in this market to work and bounce between continents from one project to the next.

However the past 12 months(2008/2009) have been slow in comparison to 2006 and we have seen a number of seasoned professionals move from the contract market after failing to secure a new contract to permanent roles for the security of permanent work in these uncertain times.

Also 2009 has also seen key system integrators who were or have been key players in the Oracle Retail market over the past 5 or so years, who were capable of delivering a complete Oracle Retail solution, completly downsizing their Oracle Retail practice and personnel. This has paved the way in the past year for smaller boutique consultancies offering specialisms in specific modules only and new larger consultancies entering the market who have not previously delivered Oracle Retail projects. It will definately be an interesting Oracle Retail climate next year and I envisage alot more partnerships between Primary System Integrators and smaller boutique consultancies who have the expertise and experience.

The bottom line is with the economy looking odds on for a recovery projects can go ahead, employers can begin to recruit with confidence and contractors who are not in the niche areas of Oracle Retail and Oracle eBusiness in general can also look forward to a return to post recession rates.

Also employers who converted contractors to permanent staff may face a battle to keep on to their staff as more opportunities arise in the market and their staff begin to get itchy feet knowing they could be earning twice as much in a contract role.

Lets hope 2010 is a good year.


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