It’s boom time for accountants in the Midlands. In 1997, there wereed accountants are much in demand in the Midlands, writes Jonah Bloom. not enough quality staff to fill all the quality jobs – if you had a GCSE in maths, you were in demand.
And despite evidence of a dual economy, in which the service sector is on the rise while manufacturing falls, there are a number of reasons why 1998 should turn out to be another good year for the accountancy recruitment market. To take full advantage of the opportunities, just make sure you’re proficient in SAP accounting software, or get some experience of outsourcing.
Merger mania among the Big Ten, Six, Five (delete as appropriate) has always benefited the recruitment market, with inevitable fall-out from merging firms in addition to the pulling power created by new, big, fee-earning, multinational organisations.
The recent proposed tie-up between Coopers & Lybrand and Price Waterhouse has created a little stir in the market.
‘A lot of it’s just speculative at the moment, but there are people in the Birmingham offices of these firms who are dipping a toe in the water,’ says one recruitment consultant. ‘There will be a lot of power play if the merger goes through, and that’s always good news for us.’
The collapse of the merger between KPMG and Ernst & Young has not been taken too hard. Adam Leon, director of Michael Page, says: ‘Merger activity is beneficial, but it’s good that the KPMG one fell through because a Big Four might have cut down the options for some accountants and reduced movement between firms in the long run.’
But in the short term, it is good news. Although the firms have issued strenuous denials, rumours of redundancies have persisted. In an interview with Accountancy Age, PW senior partner Ian Brindle acknowledged there would be job losses in back office functions. Whatever happens, speculation will inevitably lead to movement among the firms.
Brian Woods-Scawen, a partner at Coopers & Lybrand’s branch in Birmingham, denied people would leave the merged firm, claiming instead that people would want to join it.
‘There has been a powerful rate of change for some years now,’ he said.
‘People who don’t like that rate of change will already have left the firm. We are more likely to attract people, because we’ll obviously be an incredibly attractive proposition for young people looking to further their careers.’
While it looked as if the E&Y/KPMG merger was still on the cards, there was also speculation that there would be some staff migration from the Big Four to the Group A firms. There is a case for saying that Group A work is likely to involve more personal contact than the global client work of the Big Six, and this may influence staff who are looking for a move.
Whether the speculation is seen to be well founded or not, all of the Big Six firms have a big presence in the Midlands, and merger activity has added fuel to an already blazing recruitment market.
The national boom in outsourcing is another factor that has had a major effect on the Midlands. All the Big Six have been looking to set up shared service centres with their clients, and the Midlands has provided a perfect location for many of these.
Andersen Consulting has led the way, setting up shared accounting and IT centres with Sears, Conoco and Mobil, among others. Sears’ new centre is in Leicester, Conoco is in Warwick and Capital One has just set up a shared service centre in Nottingham.
Rumours suggest there is at least one more major service centre destined for the region. These centres, most of which have sprung up in the past 18 months, employ hundreds of people, many of them accountants and accounting technicians. They have benefited the recruitment market in the Midlands, although one local accountant guards against too much optimism about their long-term future.
‘You have to bear in mind that these things are set up on short to medium-term contracts. They are good news for the immediate future, but if the contract goes elsewhere you might suddenly be left with a number of technically experienced people who have no job. What would that mean for the area? My guess is it would deflate the job market.’
Manufacturers are also fairly footloose these days, often moving where they get the best subsidies, tax relief or cheapest labour costs. But the accountancy recruitment crew considers the recent influx of manufacturers to be another good sign for the area. Mark Seymour, director of Hays Accountancy Personnel, says the area is ideal for manufacturers – and should attract service providers too.
‘The Midlands has perfect communications links,’ he says. ‘The M40 is an excellent link, and Birmingham has firmly established itself as a modern city in the past few years. Blue-chip companies are very active in the area. All of the accountancy institutes have a presence here, and the West Midlands development agency is very active in attracting people to the area.’
Seymour cites as proof Calor Gas, which has just left Slough to set up a new headquarters in Leamington Spa. Other firms have made their presence felt in the area in recent months, including hygiene products firm McHeeters, pharmaceuticals giant Smith & Nephew and Epson, the desktop printer manufacturer.
The manufacturers have done sufficiently well – despite the dual economy – to increase the number of jobs for accountants, according to Abrahams.
‘Roles that were scrapped in the recession have been resurrected and even increased in the last few years. The analytical, nice-to-have roles are back.’
East Midlands Electricity has taken on eight chartered accountants recently, and Rolls Royce has also recruited a handful of accountants to its team. In addition, says Abrahams, US and Japanese firms are coming into the area, many of them bringing only a bare skeleton of staff from their own nations.
Abrahams reckons the Midlands manufacturing boom will continue, albeit in a calmer fashion than in the frenetic days of 1997. ‘There are indications that the market is topping out,’ says Abrahams, ‘but it has not happened yet.
In fact, the recruitment market in February was as vibrant as the market last year.’
There is evidence of a good deal of accountancy practice expansion as well. Seymour says: ‘There are a few medium-sized practices being set up at the moment.’
He points to the success of Bentley Jennison, a fringe Group A firm which has offices springing up in Stoke, Telford, Birmingham and Milton Keynes.
Clement Keyes, another growing, medium-sized firm, is also thriving in the area, as is Cooper Parry Prior & Palmer, which has offices in Derby and Nottingham and is believed to be enjoying a Midlands-based boom.
In addition, according to all the consultants, the Big Six in the Midlands are keen to attract anyone who has the requisite talents. Abrahams says: ‘There is still very strong demand for chartered accountants who fall into what I would call the “top quartile”. If they have the personal skills as well as the qualification, they stand a good chance of being recruited into tax, corporate recovery or corporate finance.’
Abrahams was not the only one to mention corporate recovery. There were at least two reports of the Big Six strengthening their insolvency departments – as good an indication of an incoming recession as any. ‘People can still move at very good salary levels,’ said Leon, dispelling any thoughts that the gravy train of the last few years has been derailed.
Seymour confirms the view that demand is still high. ‘The Big Six are always looking for someone with a new angle, someone who adds value,’ he says. ‘And anyone who can offer SAP experience can pretty much write their own cheque.’
Newly qualifieds are also in very short supply, says Leon. During the recession, the number of people training to be accountants went down, and in consequence the Midlands is still experiencing a dearth of young accountants.
‘It is a problem right across the country, but it is very noticeable here,’ says Leon.
Seymour agrees: ‘Traditionally there has always been good demand for newly qualifieds, but there are even more opportunities at the moment.
It’s almost “what do you want, what salary do you want?”.’
Eventually the bubble will burst; on a national scale, it is probably already deflating. But the Midlands is experiencing enough of a boom to be of interest to any accountant looking for a lucrative move.
London is still a long way ahead of the rest of the country in terms of opportunities in banking, but for accountants who are looking for an opening in the manufacturing sector, the Midlands would appear to be prime hunting territory. And that’s not to mention a host of staff-hungry practices of all sizes.
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