Despite the year beginning with uncertainty, many businesses have continued to invest in resources and revenues remain steady. For tax candidates, this means that the market has remained very strong.
In this latest article, our Managing Director, Mark Glubb offers his insights into how the tax market has fluctuated over the past 12 months, how things are shaping up going into 2022 and the impacts this will have for both candidates and businesses.
There were fears in the early days of the pandemic that revenues would drop significantly within accounting and law firms, but these fears quickly dissipated. In-house was in fact less negatively affected in 2020 than expected and saw continued, steady growth in the final quarter. Much of this was driven by continued Brexit related work (primarily VAT and Customs issues), Covid related matters and further push towards tax automation.
The final quarter of 2020 saw the first signs of a pick-up in vacancies and new positions across the tax sector. We also saw firms with staff on furlough in a position to be able to bring those people back into the business – an encouraging sign that things were beginning to bounce back.
As businesses realised that the rise in M&A activity in the wider market was set to continue throughout the whole of the year the number of vacancies accelerated in the first quarter of 2021.
The negative impact on the market at this time was the reluctance of employees to move jobs, because they valued the security of staying where they were during what was still a relatively uncertain period.
Moving into quarters two and three of 2021, the picture has shifted again. Vacancies continue to rise, and the willingness of candidates to consider moving positions has improved.
There are staff shortages across the tax market but the real pinch points for hiring managers are in M&A, TP indirect taxes, R&D tax and Tax Investigations. An article from Vacancysoft in June this year shows that the demand for UK tax accountants is the highest it’s been in over two years. Businesses are crying out for new talent, but the talent, so far, has not come to them.
In response, businesses are increasing the pay of existing staff and salary bandings are currently rising at an average of 6%. To attract candidates, firms are now starting to offer sign-on bonuses and hiring good talent by offering an immediate promotion. Alert to the difficulties of hiring talent, businesses are increasingly trying to buy back potential leavers. Meanwhile, in-house has shown signs of growth as the demand for tax services has grown. The impact of tax automation has significantly increased the need for people with broad tax technology skills as part of their toolkit of tax skills. All of these behaviours are classic indicators that we have moved into a ‘hot market’ for tax talent. It’s a great time to be a candidate!
2021 looks like being a very profitable year for many accounting firms. This trend shows no signs of abating in 2022 either, so many businesses are now setting out ambitious growth plans for the months ahead.
Unless we see a major economic downturn at the end of 2021, which looks unlikely now, then this really is a great time for candidates to make their next career move. Demand is there, businesses are recruiting, and there is a shortage of talent. So if you have the skills and the ambition, then now is the time to consider your options as it’s become “a candidates’ market”.
Flipping the coin to the businesses in this situation, one of the key motivators in candidate job decision making will be the proposition that firms put to their candidates. Those looking to move generally value firms who are fair and have well defined flexible working policies. The companies who adapt to these needs, as well as offer the short term benefits such as sign-on bonuses, are the ones who will win the talent battle in this very competitive tax market.
For open and honest advice on what your next step should be and where you could find a new, exciting role, get in touch with our team of experts.