When Michael Page announced its interim results this week, one thing stood out (apart from the profit warning). Steve Ingham, chief executive, said Michael Page had reduced its headcount by 66 people and that this had mostly been achieved through the departure of junior consultants who had left entirely of their own accord.
Financial services recruitment firms have traditionally been big hirers of university graduates. Ingham's comment suggests their junior recruitment doesn't always work out.
“A lot of recruitment companies will hire 3 graduates in the expectation that 2 of them will leave within six to nine months," says one recruitment consultant who specialises in hiring recruitment juniors. He adds: "The problem is that a lot of graduates have a glamorous view of the recruitment industry - especially the financial services recruitment industry. Fundamentally, however, recruitment is a repetitive sales role - it's about picking up the phone and making things happen."
One ex-financial services recruiter who went into the industry after graduation says the real problem is that recruitment firms make unrealistic promises of commission earning potential and the job is extremely boring. "They pretend you'll be earning six figures and doing something interesting. The reality is that you'll be killing your brain and throwing mud against a wall trying to get candidates to move into jobs they're really not bothered about," he says. "I'd rather do something more interesting with my life."
The recruiter of junior recruitment consultants, says the first 6-9 months of a junior recruitment career are usually the crunch point. "You'll be starting with a desk that's completely cold and you have to source clients, and get their business," she says. "By the time you're recruiting you're in month 4 and by the time you start actually making some cash, you will be in months 4-6."
The implication is that junior recruiters will be living entirely off their base salaries. This isn't necessarily the case, says Gabby Gerra, director of recruitment to recruitment firm Orint. “Most people will earn salaries as well as commission," she says. "Commission is still on offer in the financial services recruitment industry – but it’s not as high as it was. After two years you can probably expect to earn a total package of £40k - £60k, salary and commission included."
Anecdotally one of the major turnoffs for junior financial services recruiters in all markets - but especially in the current market, is the oppressive use of KPIs. Some junior recruiters complain that their every move is being watched. Recruitment firms will typically have KPIs around everything from client meetings to candidate registrations, first interviews, and lead generation - asking candidates where else they've been interviewing in order to follow-up those leads later.
If you're a junior recruiter and you don't want to be ruled by KPI's, Gerra suggests you work for a small firm. "The recruitment firms which are very heavily focused on KPIs can be quite aggressive and may have a higher turnover of staff,” she says.
The sad reality is that financial services recruitment firms may be far less partial to junior staff in future. In place of fresh graduates, recruiters of recruiters say many firms are now trying to hire seasoned consultants who know how to handle a difficult market.
One financial services recruiter sums it up: "When the market is good, recruitment can be quite an easy job. The earning potential is fantastic and you can place reasonably good candidates without too much effort. Now, however, it’s really difficult to place even super-super people. Clients have really raised the bar".