UK Interim: Procurement and Supply Chain Recruitment - Market Update, October 2021

In recent weeks we have seen an encouraging increase in Interim Procurement and Supply Chain Recruitment activity, with increased demand overall for Interim resourcing. Long timescales to fill permanent vacancies; more ‘on hold’ projects coming on line as pandemic restrictions have lifted; demand for very specific ‘hard to find’ supply chain skills and Clients and Interim specialists coming to terms with the IR35 Off Payroll regulations introduced last April, have all driven up demand for Interim talent.

Recent insight data from CIPS has shown that ‘Managing Risk in the Supply Chain’ was identified as the number one challenge for private sector companies and was listed the fourth most important challenge amongst public sector organisations. ‘Recovery from the COVID-19 Pandemic’ was sighted as the second most important priority amongst Private Sector companies and the most important amongst Public Sector organisations. Clearly the pattern of demand for Interim talent is reflected in these organisational priorities.

This is what we have seen in the last few weeks:

What’s in demand?

Vendor/Risk Management Specialists: Procurement specialist with solid Supplier Risk Management experience are still very much in vogue, and candidates with a strong experience in Fraud, Quality, Compliance, Cost and Delivery strategy and implementation are being snapped up fast.

Logistics and Supply Chain specialists: Increase supply chain volatility and risk in post Brexit and Pandemic effected supply chains have really refocused the necessity for effective Logistic and Supply Chain Management and any specialists in these areas are likely to secure great roles on either interim or permanent basis.

Cloud/Software Specialists: Required across all sectors, but in particularly in FinTech, Retail, Pharma, Logistics and Supply Chain. Organisations are having to rapidly change their work and supply chain models, are needing ‘hit the ground running’ IT procurement specialists and we have seen a strong increase in demand for people with relevant and up-to-date software and cloud experience.

Digital Marketing Specialists: Required across all sectors, but in particularly in Banking, Retail and Pharma. Pandemic has brought rapid and unprecedented change in how we market, supply and buy; and the demand for marketing processes that reflective these changes has seen a significant increase in the demand for Interims in this area.

Professional Services Specialists:  Again, a significant increase in demand across both the private and public sectors, driven by extensive renewed activity in all sectors.

Public Sector

The Public Sector is still very busy, with Test and Trace, Covid related projects and ongoing demand from central government institutions (Covid-19 and Brexit/Free Trade related) all driving demand for various level of interim specialists.

 

Major Consultancy Firms are still busy supporting both private and public sector organisations. including policies to mitigate risk associated with IR35 Off-Payroll regulations.

IR35 Off-Payroll legislation had undoubtedly stalled and supressed the Interim market over the last three years presenting significant challenges for both organisations and Interim Procurement Specialists. Now five months down the road from implementation, we are seeing clients and interims a little more settled with their relationship and market rates beginning to adjust to suit.

We are beginning to see a few more of our clients choosing to secure expert interim labour on an outside IR35 basis, if they can be sure that the project relationships do meet the criteria of a true contracting relationship; which many senior interim project roles do. This has the benefit of offering the true Interim Consultant the renumeration and benefits limited company status offers; and helps the organisation attract the best talent available.

However, overall companies continue to be cautious to mitigate tax liability and reputational risk with most hires remaining on an Umbrella or Fixed Term Contract (FTC).

As specialist permanent roles remain unfilled and with demand for very specific skills increasing, we have seen more companies looking towards interim options and with the increased demand and an underlying trend of salary inflation, we are seeing upward pressure on day (or equivalent FTC) rates.

More companies are offering slightly increased rates to offset the impact of roles being insider IR35 Off-Payroll regulations to help them secure better candidates.

However, some companies have not adjusted rates yet to address the reduction in take home pay that the extra tax those contractors deemed inside IR35 are having to pay. In a market where wage inflation is at a recent all-time high, we would suggest the ‘like it or leave it’ approach adopted earlier in the year will no longer be sustainable if you need to attract the best interim talent.

We anticipate interim rates strengthening as we move through the remaining year.

Conclusions

The need for an agile Procurement and Supply Chain workforce is we believe greater than ever, as organisations try to adapt to a rapidly changing world post Covid-19 Pandemic and Brexit; and we see the underlying demand for talented Interim procurement and supply chain resourcing remaining solid.

In the last few weeks, we have seen the Interim market strengthening and we expect to see this maintained, assuming the UK continues to move out of the pandemic and the economy remains in growth. A flexible and skilled procurement and supply chain interim resource is a critical contributor to business growth and success, particularly in a fast-changing post pandemic-influenced economy.

It would appear that the market is finding its equilibrium adjusting to the IR35 Off-Payroll regulations, and although we have seen a significant move in favour of Fixed Term Contracts, we are beginning to see more  traditional ‘day rate’ roles coming back on stream, particularly for senior roles that truly fulfil the definition of an independent contractor who provide supply chain and procurement expertise and policy to their client.

Organisations that have managed to determine that their roles fall outside of IR35; or have defined work on a Statement of Works Contract, are likely to get a better response rate. To secure critical projects, whether working inside or outside IR35, careful consideration needs to be given to the rates to ensure attraction and buy-in from specialist Interim talent that is increasingly in short supply.

Overall, we are seeing positive growth in both Permanent and Interim Procurement and Supply Chain recruitment, interim and permanent rates are strengthening ahead of average UK wage increases and Procurement and Supply Chain is gaining visibility amongst the public and Director / Head decision makers which puts the function into a more visible and influential position than maybe ever before? According to the latest CIPS survey “perceptions of procurement and supply management remain consistently positive, with 67% of respondents believing that the profession is valued within their organisation. Encouragingly, there is increasing recognition from senior audiences, with more Directors and Heads of other departments understanding what procurement specialists can offer - increasing from 66% last year to 73%. This suggests that the pandemic has emphasised the strategic benefits of a strong procurement function.” (Source: 2021 CIPS Procurement Salary Guide and Insights)

The main challenge is securing the talent needed in what is becoming and ever more competitive market. Attraction policies, whether for Permanent or Interim staffing, need to be carefully considered and accurate and up to date market knowledge is essential to ensure organisations implement HR resourcing policies that reflect the reality of a very competitive talent market.

Oliver Lewsley

Recruitment Director