Channel prepares for jobs crisis
Supply outstripping demand for first time in years with particular surplus in senior management skills expected
Job consolidation may become the new buzzword of the channel as more firms begin to strip out extra costs from their business to see them through the recession.
This in turn could lead to a surge of redundancies in the industry, with supply outstripping demand for the first time in years.
A recent report from market watcher KPMG revealed that permanent placements have dropped for the eighth consecutive month in a row, but the number of candidates looking for jobs has skyrocketed.
Derek Jones, UK managing director of VAR buying group Synaxon, said more job losses are on the horizon. “Many of the major channel players are still overstaffed. We have already seen some of the world’s largest IT vendors reducing headcount to ride the global recession.
“I have no doubt that this trend will continue and even intensify in the early part of 2009,” he said.
“Larger players will also be finalising their fiscal results and those that are not yet at year end will be reviewing results.
“All of this number crunching coupled with anticipated lower December sales results will fuel an increase in downsizing,” he added.
Jon Godfrey, director of Sims Lifecycle Services, agreed: “Many firms are waiting until the new year before making announcements.
“People can optimistically view this as a correction of the economy. The really good players in the channel will recover quite strongly, but there is absolutely no doubt that it is going to be a difficult year for everyone in the channel.”
Neil Sutton, director of specialist channel recruitment consultancy Attwood Beck, said that businesses would be more choosy about the people they employ.
“Channel firms will look to consolidate non-sales roles and creating one role from several positions. There will be a surplus of skills, particularly in senior management,” he said.
Stuart Fenton, president of Insight EMEA, agreed the going would be tough. “I believe we are about to see some haemorrhaging of staff from the channel," he said. "Those firms that have the pockets and ability to fight through will be in the best position when the market picks up. Our recruitment plans within our sales organisation have not changed.”
Matthew Gower, vice president of the UK and Nordics at distribution giant Avnet, appeared confident about the new year.
“We believe that we have the right amount of resources. It is simply a matter of making sure the resources and skills are allocated where they are most needed.”