Interim managers riding wave of high demand

Friday 27 September 2013

An upturn in business prospects and sizeable skills gaps mean that conditions are improving for interim management contractors, as a new report shows that demand and rates are both on the rise.

Interim recruiter Executives Online’s latest Interim Report shows that contractors in this discipline are seeing demand and rates come close to the peak levels seen before the financial crisis. According to the new figures, nearly four out of ten interim managers are currently on a full-time assignment, representing a much healthier market than 2009 and 2011 when the figure was below 30 per cent.

Another nine per cent had managed to achieve full-time work through a combination of part-time assignments, while 15 per cent were working part-time. The fact that both of these are little changed from 2011 suggests that some interims are happy or even prefer to tailor their way of working to their needs in this way. Overall, just 39 per cent were not on assignment at all compared to nearly half two years ago.

Demand for their services shows few signs of slowing down - 37 per cent of interims said they were less busy than they had been a year ago, down from almost half in 2011. At the same time, 27 per cent reported that they were more busy than they had been - a figure which has risen by seven percentage points in the past two years. Overall, interims had billed clients for an average of 152 days in the previous year, a noticeable difference from 135 in 2011 and 2009.

When it came to the length of an average assignment, little has changed from the last survey, with a relatively long average duration of 7.64 months. However, Executives online adds that governmental moves to tax controlling persons who are in post for long periods via PAYE - such as the infamous IR35 legislation - may affect the assignments taken by contractors working through their own limited companies.

The field is still predominantly male, with women making up just 20 per cent of the interim managers who responded to the survey, but this could bear a relation to the average age of the contractors. Just over half those working as interim managers are between the ages of 50 and 59, with the typical male contractor being 55 years old. In stark contrast, the average female interim manager is 49 years of age and among those under 50, the proportion of women stands at 46 per cent. As demographics change and older workers approach retirement, it looks as though the gender disparity in interim management is set to close.

It may be that more young professionals are drawn into the field as daily rates increase, a trend which looks set to continue. Nearly a fifth said they were charging more as their daily rate while 58 per cent said they were billing for the same amount - so despite the fact that just under a quarter reported charging less, the average daily rate rose once again to a very healthy £637. In spite of some fluctuations as a result of the economic downturn, rates have generally stayed on an upward trajectory, and it is likely that contractors will benefit for plenty of time to come.

By Victoria McDonnell

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