Market at “boiling point” by a post Brexit talent shortage
London-based network engineering recruitment firm Hamilton Barnes has reported that “a counter offer culture” is gripping the tech recruitment sector as candidates “go to market to get a payrise” triggered by the cost of living crisis and a post-Brexit talent shortage.
George Barnes, Co-founder and Director of the firm said this was prompting “desperate attempts to hold onto talent” and “wild counter offers of up to £40,000 extra”.
He explained: “Inflation and the cost-of-living crisis has had no real effect on our clients in terms of hiring. While some sectors may have experienced recruitment slowdowns, we are seeing clients in the tech sector hiring ever more aggressively.
“Meanwhile, the effect our current economic situation is having on candidates is that they are reading about it and hearing about it in the press and they are going to market in huge numbers to get a pay rise, especially if they believe they are not in a position to get one in their current role, maybe because they think they haven’t been there long enough to get one or are in a structured role where they know they are not due one yet.
“In turn, employers who are determined to hold onto talent in a market where talent is highly prized and in short supply, are counter offering really aggressively into the tens of thousands.
“In the last week, I have seen one employer go up by 40k on someone’s salary to hold on to them when they were offered a role elsewhere because they were clearly so desperate to hold onto them. This sort of offer is phenomenal and can only be counter-productive.”
Barnes, who co-founded Hamilton Barnes, with Nick Barker in 2014, said the market had already been brought to “boiling point” by a post Brexit talent shortage:
“Salaries in tech have risen massively since Brexit – most have doubled at least with a typical salary we might have seen pre-Brexit of around £54k is now around £100k,” he said.
“Salaries were previously diluted by the influx of European workers into UK tech – for example when the Greek economy collapsed and lots of Greek specialists relocated here, happy to work for 25% less. It was a similar story with talent from Portugal and Spain.
“So, the market pre-Brexit was far more competitive talent-wise with more candidates competing for the best jobs so salaries were kept down and employers never counter offered. We have seen a complete reversal of that. We are firmly in the grip of a counter offer culture and we need to calm this down.”
Barnes said he believed agencies like Hamilton Barnes, which saw record growth during the Pandemic, had a responsibility to clients and candidates to “take unnecessary heat out of the market”, and said he was “steering some candidates back to their current employers”, explaining:
“Of course, we want candidates who are genuine candidates looking for their next role but we are not interested in people who are moving solely because of a kneejerk reaction to press reports of a cost of living crisis.
“My advice to candidates who are only moving because the current market conditions have triggered them into wanting a payrise is that they should not need to look externally but if they think they are stuck because they don’t meet the criteria to hit the next threshold where they are and are worried about pay, speak to their current employer. Employers in tech want to hold on to their talent and are open to conversations.”