Published on February 3rd, 2014 | by Nigel Peters0
The Pressures of Economic Growth - A Welcome Problem and Opportunity
The new year has started with a tremendous surge of interest from clients as they initiated projects and programmes, and also from candidates as they took the opportunity to refresh their efforts in the marketplace. Having been with Alium Partners for nearly four years now, it is fascinating to see another phase of the economic cycle which brings with it some very unique challenges for all.
Status of the Market - Economic Growth Is Here
So as ever, I’m always asked what is the state of the market - well if you haven’t noticed it is excellent, based on the difficult conditions since the turn of this decade. But tough times have brought significant benefits to businesses that have survived and adapted to a recessionary market. Growth can hide evils and we must not let those evils return.
Economic Growth Means The Corner Has Turned
The current activity levels both here in London and in our offices in Buenos Aires are such that it is clear the corner has turned. Enquiries, website hits and the crude metric of the number of people we have placed in the market are all up. In further support of this pick up, I also had the pleasure of attending an outstanding Private Equity seminar at prestigious accountants BDO recently. Their economist of choice, Doug Williams from the CEBR, gave a canter though economic indicators which provided the true data behind what is happening in the economy. His commendable work is well worth looking up.
Be Aware Of The False Dawn
But there was a critical message behind Doug’s statistics. The UK has to change its game and recognise that complacency and growth can’t hide the enormous budget deficit that still exists - and will remain for a long time unless we properly address it. The US will effectively take theirs from 8% (of GDP) to 0% in just three years. We have not been that diligent as our government waters down its proposals and hides from the reality with the face of an election looming. In essence, we have a mini boom for the next three years - until we get the other side of a general election. The government realises this is a small false dawn and we have to face up to the reality that our public spending is still too high.
Market Message - So What Is the Impact?
But what is the impact for the clients and candidates that we work with every day?
- For our clients: continue to adapt and change, but don’t forget the fundamentals of cash, P&L, balance sheets and wise investment from your gains. Keep the foot on the pedal and be ready for the next phase of the market.
- For our candidates: an agile approach to resourcing (as is the message of our refreshed brand and website) is a highly cost effective and efficient deliverer of change. Don’t be greedy and chase the buck – this only pushes up day rates and damages reputations by flitting from one role to another. See your projects through and the reward is increased utilisation, rather than become an untrusted and unreliable capability.
How do you see the economic growth? Are you positive there will be plenty of opportunities or are you rather on the cautious side? Please comment below.
Photo credit: hh5800