Financial contractors could benefit from retirements

Monday 23 November 2015

Financial contractors are likely to experience a surge in demand for their services in the coming years, according to recruitment specialist Robert Half.

Research by the company found that the vast majority (88 per cent) of financial companies were making preparations for the retirement of baby boomer staff (defined as those between the ages of 51 and 69) over the next two to five years.

However, many are still concerned about the potential impact of losing their most experienced staff. A total of 74 per cent thought the impending retirements would have a negative impact on their business. This worry is most pronounced in small businesses, where 84 per cent expect a negative effect on their company, compared to 77 per cent for medium businesses and 69 per cent of larger organisations.

This makes sense, as when you have a greater number of employees, it is easier to redistribute resources to deal with a number of departures, whereas in a small company the leaver may be one of only a few within the finance team.

While businesses of all sizes will be looking to hire and promote to fill these gaps, it is likely that the process could take some time, particularly if the current low levels of candidate availability continue.

Phil Sheridan, UK managing director of Robert Half, said: "With employers challenged in finding the skills they need to grow their businesses, establishing a succession plan with a robust attraction and retention strategy will be critical to succeed in today's economy. In some cases, offering project or interim contracts to employees nearing retirement will open up positions for aspiring managers to move up the career ladder, while still operating under the guidance of a mentor."

The research also suggested that companies will need to look at ways to make themselves more attractive to younger workers, who may often have different wish lists and priorities to their predecessors.

The most common ways that businesses are preparing for the retirement of their older staff include upping their training and recruitment schemes (45 per cent), enhancing benefit programmes (32 per cent), hiring mid-level talent to develop a skills pipeline (27 per cent), increasing mentoring programmes and knowledge transfer (25 per cent), hiring senior-level talent to replace retirees (22 per cent) and offering flexible or part-time work arrangements to hold onto older staff (16 per cent).

These are all good long-term solutions, but even when these are implemented, the need to use contractors may arise, particularly when high levels of specialist knowledge and expertise are required. Even when it is not strictly necessary, freelancers can still help to smooth the transition from one generation of employees to the next. It can also let companies free up resources for other kinds of expansion, ensuring the business grows in a balanced way.

This means that financial contractors, particularly those with substantial amounts of experience and leadership qualities, should make sure that they are prepared to take advantage of the opportunities that the retirement of the older demographic could create.

By Victoria McDonnell

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