COVID-19 Takes Toll on Recruitment Sector

The consequences of the ongoing COVID-19 (coronavirus) pandemic have been multiple, from the public health crisis that has ensued across Europe and beyond to increasing strain on the global economy; despite an already strong economy, not even Luxembourg has managed to escape this crisis.

In order to mitigate the economic impact of the coronavirus crisis, Luxembourg's government has implemented several measures to protect businesses and the self-employed in recent weeks. Just yesterday, the authorities unveiled an €8.8 billion (almost 15% of the country's GDP) rescue package to support the economy during the pandemic.

Nevertheless, the crisis has already begun to take its toll, not least in the recruitment sector. For greater insight into this matter, Chronicle.lu contacted Darren Robinson, Managing Partner at Luxembourg-based recruitment firm Anderson Wise, for an interview.

How has the recruitment sector been affected, both directly and indirectly, as a result of the coronavirus crisis?

Darren: Everyone within the recruitment sector has been impacted. Generalist recruiters and those specialising in the hardest hit sectors such as hospitality are having the toughest of times. The finance sector is still active for those who have an established portfolio of clients. Some recruitment processes have been paused and new assignments are fewer, however most companies who we are partnering with continue to look ahead. In fact, we had 35 candidates interviewing (video) with our clients in the last ten days. Candidates are behaving a little more cautious due to the uncertainty of when the schools reopen and when we are all likely to be returning to a regular work pattern.

Following the previous question, how are the government’s economic safeguarding initiatives affecting the finance and other sectors?

Darren: The government initiatives are clearly welcome and the partial unemployment relief will safeguard many roles. Currently, the support for the SMEs and independents are below what many can survive and I do fear many of these businesses in the most vulnerable sectors will not survive.

The present “lockdown” and schools closure etc. are scheduled to last until 20 April, when Easter holidays would have concluded: if restrictions are then lifted, how long will it take for companies (particularly in the finance sector) to return to “normality”? If restrictions are not lifted then, how do you feel Luxembourg’s economy will cope, including the recruitment sector?

Darren: From those who I have spoken with in the finance sector, [there are those who] see an increase in demands, trying to make up for the loss in productivity, and those who see an opportunities in times of a downturn, knowing there’s always an upturn.

What are your thoughts on the government’s JobSwitch initiative which uses an online platform to connect people who are currently unemployed with businesses seeking staff? Is this something that could outlive the coronavirus crisis and, if so, will this affect the recruitment industry?

Darren: From the face of it, it looks like a great initiative. I’ve heard of similar concepts and the platforms are somewhat passive. It would be great if companies first looked at the talent within the platform, looking at transferable skills that could benefit the company and the individuals seeking employment.  Many companies just do not have the resources or the expertise to identify the right employees and outsource this to the recruitment industry. It will require a lot more than a passive platform to compete with those who work in the recruitment industry, who are inherently proactive with years of expertise.

When “normality” returns, what do you feel will happen to recruitment in Luxembourg, in particular regarding the finance sector?

Darren: For those who know me and my team, you’ll know we’re eternal optimists. Of course, we will have challenges in some quarters and we will see a great demand in others. Many in the financial sector will see opportunities and further strengthen their teams. Anderson Wise are looking forward to the "new normal"!

Following the previous question, what parts of the finance sector do you feel will be best equipped and most suited to recovering from the crisis?

Darren: Private Equity (PE) firms having applied an opportunistic approach in this market situation and they continue to make deals in these difficult weeks. Their predominant administrative (accounting) tasks can be equally performed from home as in the office. However, some firms still have limited capabilities for homeworking, where many staff still have to commute and work in the office. This is more likely to lead to a negative impact on the employee engagement and a slower recovery. Fintech is still developing quickly in Luxembourg and has the ability to recover and grow even further due to this crisis.