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Overview of the UK in-house legal recruitment market

Posted by: Laurence Simons 20/04/13

Life Sciences legal recruitment market in the UK

The life sciences market in the UK experienced a limited but consistent flow of opportunities at all levels during 2012. This was despite some well publicised redundancies, the continued trend of large mergers and the knock-on effect of integration and reorganisation.

With the increase in focus on creating a lean legal department, there was an increase in the demand for junior lawyers and paralegals, particularly to assist with day to day contractual work. Candidate supply at this level did not meet demand, which has led organisations to consider other sector focuses and functional backgrounds. Remuneration within the life sciences sector remained fairly constant with only very slight salary increases being experienced in 2013.

Energy legal recruitment market in the UK

As was the case in 2011, the energy sector remained more buoyant than other areas, although the majority of the demand was in oil and gas as opposed to renewables or utilities.

Although ever fluctuating oil and gas prices continue to influence the fortunes of the major energy companies, most are sufficiently cushioned and thus able to focus on medium to long term hiring strategies. Accordingly, oil and gas companies have continued to recruit although competition for in-house roles has remained fierce, resulting in organisations being able to practice a level of caution when hiring and hold out for the most suitable candidates.

Contrastingly, the renewables and utilities industries fared less well. Turnover in utility companies remained lower whilst the renewable sector continued to struggle as the reality of the state of the economy took precedence over more lofty environmental considerations.

Going forward, it is expected that the current status quo will remain with oil and gas being the dominant area within the energy sector and the demand for mid-level lawyers as opposed to more senior (or junior) counsel being the reality.

FMCG & Retail legal recruitment market in the UK

2012 was a difficult year for the British high street as well as for fast moving consumer goods (FMCG) organisations. The continual Eurozone crisis coupled with the weaker than expected US recovery led to low consumer confidence levels and limited disposable income. Although this affected many industries, luxury brands were perhaps the hardest hit with consumers limiting their spending to necessities rather than indulgences.

With a few notable exceptions, the FMCG and retail recruitment market has been relatively weak with hiring being limited to replacement hires and salaries remaining static. Whilst in 2011 the exceptions included companies exposed to emerging markets, as well as luxury goods manufacturers, this trend did not continue into 2012 and it was only those companies with good management and in-demand products that continued to weather the storm.

Prospects will only improve once consumer confidence begins to increase on a sustained basis.

TMT legal recruitment market in the UK

TMT is both a diverse and pervasive sector and as a consequence, better able to weather the economic situation than most. Accordingly, recruitment in this sector continued to buck the general trend.

Technology companies continued to hire and whilst one might have expected media companies to have struggled in 2012, there was a reasonable level of activity in this area. This is not to say that it was an easy year and the much publicised struggles of various high profile technology multinationals are testament to the difficult conditions in which these companies are operating.

More specifically, mid-level lawyers remain the most desirable but with overall demand still limited, only the best candidates were able to find new roles in 2012. Generally speaking, companies are interested in the full range of IT / technology experience although outsourcing lawyers, in particular, remain in short supply.

Whilst the TMT sector has fared better than others, demand has not been sufficient to outweigh the ever present need to control costs and as a consequence, salaries for the most part have not changed. Benefits packages also remain largely similar to previous years, and it is anticipated that salaries and benefits will continue to remain static well into 2013.

Professional services legal recruitment in the UK

The professional services market was slower than others but with a steady flow of roles being recruited throughout 2012. The majority of legal departments trimmed their legal teams down, maintaining a lean level of headcount and hiring only for strategic reasons. Where hires were made, organisations sought after thought leaders that brought with them practical skills and experience, as well as innovative ideas.

There was an uplift in the number of organisations looking to increase headcount abroad, often as a key regional contact for their teams in Asia or the Middle East.

A demand remains for candidates with data protection or compliance skills as well as solicitors with four to seven years’ post qualified experience. Candidates from an IT background or indeed those from private practice are often attractive to those hiring in professional services and competition for these professionals can be fierce. Organisations have had to focus on establishing clear career progression plans to entice and retain key talent.

As with most sectors in the UK, the professional services space has been challenged by difficult economic conditions and organisations have had to concentrate on retention which in many cases has been in the form of regular salary reviews.

2013 does not appear to offer much change within professional services, with companies remaining cautious and no major recruitment drives being anticipated. Salaries are likely to remain at similar levels to 2012 although employees may be able to negotiate pay rises in cases where they are seen to be difficult to replace.

Compliance recruitment in the UK

There was significant recruitment activity within the compliance area in 2012 with many organisations looking to bolster their internal regulatory functions and some introducing regional compliance departments outside of their central hubs. Larger companies have also reacted to the requirements and possible implications of the UK Bribery Act, particularly those parts that potentially go beyond those of the US FCPA.

28% of organisations indicated that they currently have compliance as a standalone function within their business and it is anticipated that this trend will continue in 2013.

57% of companies choose to incorporate compliance as part of their legal department with only 6% including it within the finance division of the business.

The demand for first time European and global regional head of compliance roles continues. However, there are also many junior level roles (typically from two to five years’ experience) being recruited, with companies either recruiting from within other areas of their business or increasingly looking externally for those with existing compliance experience from another firm or organisation.

Remuneration for those working within compliance will continue to rise in line with the increasing importance and elevation of the discipline coupled with the demand for talent. For more senior and strategic roles, candidates, whether from legal backgrounds or not, are being paid in line with, or in some cases more than, their legal counterparts.