Welcoming the new recruits
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The sale of legal recruiter QD to TMP Worldwide and an increasingly candidate-led legal market may change the face of legal recruitment forever. Fenella Quinn reports.
The recent multi-million pound submersion of legal recruitment giant QD into US advertising monolith TMP Worldwide has sent ripples of concern throughout the industry. With TMP's $7.5bn (£5bn) market cap, its internet recruitment arm monster.com (monster.co.uk in the UK) enjoying 14 million hits in May alone, and a £10m advertising campaign due to roll out in September, how can smaller companies compete with such a massive force in the recruitment market?
Miranda Smyth, director of ZMB's newly-launched dedicated recruitment site, Zeureka.com is not concerned. "We're not terribly bothered because we know we can offer a really fantastic service. We believe that the web market has got to be specialised, and monster as it stands today is not a leader in legal recruitment," she says.
Zeureka.com already has eight clients signed up - Clifford Chance, Freshfields Bruckhaus Deringer, Allen & Overy, Gouldens, Macfarlanes, KLegal, Bird & Bird and Berwin Leighton. Subscribers can place their own advertisements directly on the site and deal directly with the candidate.
Smyth says that because of the new economy, recruiters without a web presence "will miss out radically", but she adds that, unlike in the US where the internet has in some cases taken over from direct consultancy, in the UK "there will always be the need for the human touch, but it needs to be highly professional and provide a lot of added value".
It may be no coincidence that the internet's presence is being felt so strongly during one of the rosiest times in legal recruitment history. Explaining the current frenzy created by the new economy, Alison Burgin, manager of Badenoch & Clark's legal permanent division, says: "The increase has partly been brought on by US firms coming in and taking the best people and giving amazing amounts of money."
Burgin also says that there are hardly enough lawyers to go round, thus creating a candidate-led market. Qualifiers' salaries are up £10,000 on last year to £42,000, causing high percentage increases for those lower down the rungs. "This is great for some, but others are disgruntled because their per cent increase may not be as much as someone below them. Because of this there is a lot of movement. They are not just motivated by cash, but it's the money that's prompted them to move now," she says.
This year Badenoch & Clark's 27 consultants have worked with NTL, Sun Microsystems and Cable & Wireless, moving Jeremy Newton from CMS Cameron McKenna and Mark Curtis from Andersen Consulting to Sun Microsystems.
The rise and rise of technology and internet business, and the growing need for experienced practitioners to service that growth, has led to a major hike in in-house salaries.
Burgin says: "Firms offering good clients in those areas are more attractive. And US companies are setting up here with a view to lawyers filling a pan-European role, so lots of people in private practice with good IT experience are being lured out."
According to Burgin, with salaries ranging from £60,000 to £115,000, enhanced by attractive packages worth up to £250,000 and valuable stock options, in-house jobs are "now no longer just a lifestyle option, they're a serious financial option too".
But this phenomenal growth is not just fuelled by IT - media, property, financial services and corporate financing are also booming. A junior magic circle partner can easily earn up to £250,000 per annum, and the million pound partner list keeps on growing.
With fees ranging from around 15 per cent to 33 per cent of a first year salary, successful recruitment consultants take home lucrative pay cheques, and new ones crop up regularly. But with sites such as totallylegal.com and interactivelawyer.com (The Lawyer's portal), and consultants' own sites set to dominate the field, few expect the pool of consultants to be even half its current size in the next five to 10 years.
QD's founder Gareth Quarry foresees a future where just a handful of multi disciplinary, globally dominant players control the recruitment market and provide "human capital management" rather than just plain job placements.
"You'll have to become global, embrace the old and new methods in one house, or you must slim down to a little mom and pop store," he says. "There will always be room for corner shops, but I don't think they'll be able to keep those store managers happy for long."
Quarry believes that sites such as the proposed QD/TMP joint effort, monsterlegal.com, are paving the way to a market where clients can enjoy a wider range of options in terms of cost and consultant intervention.
Referring to predictions that there will be 100 million CVs in cyberspace by the end of the decade, he adds: "What the internet is going to do is cannibalise the recruitment market."
Quarry says that the internet will cut down client expenditure from £2,000 to £10 in some cases, adding: "Fees will be nowhere near as large as the fees we need to charge now. We will be cutting out two major expenses - premises and staff."
Pointing to the predicted 15 per cent drop in skilled labour across the next 15 years, Quarry says: "There is a war for talent and law is right at the middle of that battle. The rationale of employment between employer and employee is changing. There is now much greater mobility, with highly sophisticated knowledge workers who are shifting around constantly."
However, Quarry and his contemporaries are on the lookout for more staff than ever. "The beauty of the clicks and mortar [the mixture of web-based and traditional office-based recruitment] combination is that you can't survive with just a pure clicks strategy. Clients want intervention, top level searches and so on," he says.
Taylor Root's Caroline Nussey agrees. "We don't envisage having one man and his dog manning the office," she says. Taylor Root, which will soon re-launch a new website with full job search database, is convinced that the clicks and mortar approach is the right one.
Nussey says: "We don't consider that the internet is a threat to us, because at the end of the day clients have always been able to advertise in the press and get internal candidates. We make judgement calls, make recommendations of people we know well. That's just been lifted up and out on the internet. Companies rely on our advice to take the headache of recruitment away from their administrative staff."
Martin Chivers of Career Legal believes that the recruiter's future lies in forging strong links with internet recruitment sites. "People are looking for jobs on the internet and their main draw is to websites advertising specific areas," he says.
Chivers says that the internet is particularly relevant to lawyers, as the vast majority have the privacy of their own rooms and a notorious thirst for information, which also takes in knowledge about possible openings.
He says that technology constraints are one of the factors holding up the advance internet recruitment. "Viewcams are not that good at the moment, but in the future, clients will be able to interview candidates over the web," he predicts.
But he adds: "Someone will still have to sift through the hundreds of non-relevant CVs. We will always need human capability to process someone's details."