Market Update Q2 2020 - Accounting & Finance

Tribe's Head of Accounting & Finance, Brad Gatehouse, shares his industry insight for Q2 of 2020. 

Obviously the biggest news from the last quarter has been COVID-19 and a seven week lockdown, so let’s call it the ‘Covid Quarter’. It forced Kiwi businesses to accommodate working from home, a trend that looks like it is here to stay!

In week one of the lockdown, around 80 percent of our active Accounting & Finance (A&F) roles went on hold. Although some are coming online again, more than half have been cancelled completely. Like many others, the A&F sector has also seen a swing from permanent to contract employment, reflecting employer’s resistance to committing to an additional headcount on their books. Some of these contracts are for genuine project roles but the majority are covering a permanent FTE. 

Industries that showed the most resilience during lockdown were (in no particular order): Software as a Service (SaaS), Fast Moving Consumer Goods (though those highly reliant upon foodservice struggled if unable to pivot into a new channel), Retail Banking and Central Government.

As one of the few countries not in lockdown, New Zealand is a highly attractive location to live and work, which is translating into increased volumes of applications from offshore A&F candidates. Most are unaware that without citizenship or permanent residency their chances are limited. Kiwis offshore are also applying in increased volumes, with many expressing a desire to secure a role before committing to booking a flight home. Although lockdown forced Kiwi employers to hire and onboard remotely, I am yet to see any A&F candidates achieve this outcome from offshore. Potentially this is possible if you have a unique skill set that is in high demand with low local supply. What are other recruiters seeing in this area? Perhaps I am wrong!

Both factors result in a stifling of the traditional A&F offshore talent top up that NZ has relied upon for years. Though not an issue in the currently depressed market, I can see these causing issues as the economy continues to heat up. The uncertain economic outlook has also made it harder to attract local passive A&F candidates. Prior to the ‘Covid Quarter’, more than half of passive or non-active candidates approached would consider looking at a new role. This has now dropped to less than 20 percent, with candidates indicating they are happy to have a job and are not looking to rock the boat. 

As unemployment rises, we continue to see an increased volume of people responding to advertising across the board and A&F is no different. Unfortunately, volume doesn’t equal talent and the available candidates aren’t necessarily equipped with the skills that are in demand e.g. commercially-focused accountants able to identify and quantify risks, identify areas for cost reduction and efficiency gains. Just like after the Global Financial Crisis, procurement is also seeing a sharp rise in demand as companies look at every opportunity to remove cost and extract maximum value. 

My mates who work in insolvency are busy but are forecasting the worst is yet to come when we return to a true economy without the Government subsidy. Add in September’s general election, which traditionally results in companies sitting on their hands, and the outlook for the next quarter remains challenging at best.