Interim management contractors are benefitting from a level of demand, rates and assignments not seen since the pre-recession days of 2007. This is according to the latest Interim Report for 2013 from interim recruiter Executives Online (EO), which also shows that filling skills gaps remains the principal reason why clients hire interims.
“The figures about interim management utilisation and day rates in 2013 show a recovery to levels near those enjoyed by interim managers before the global financial and economic crises,” confirms the report.
However despite demand and rates recovering well, utilisation, which measures the amount of time an interim has been in work on an assignment over a given period, rose to 37% during 2013. This is much improved on the sub-30% rates seen during 2009 and 2011, but has not yet reached the highs of 56% experienced during 2006.
Of the remainder, 15% of interims were on part-time assignments, 9% were engaged in multiple part-time assignments and 39% were ‘on the bench’.
The number of interims on part-time and multiple part-time assignments has remained relatively constant since the first EO interim survey was conducted in 2002, but during the depths of the recession nearly half of all interims were between assignments.
The average interim management contractor day rate now stands at £637, which is only 2% below the record levels experienced pre-recession. But although increasing steadily since the survey began, rates are actually experiencing a downward trend in real terms.
EO defines interim management as:
“The provision of a mature, professional manager, well qualified by relevant practical experience, either to fill a gap in permanent staffing or to deliver a specific business result within a limited time period.”
This definition is well reflected in the main motivations for clients to use interim management contractors. The research notes that 32% of clients “needed skills not present in the existing management team, for a fixed-term project”.
The next most common reason for hiring an interim is to cover a gap while recruiting for a permanent hire (15%), followed by the need for extra management capacity (14%) and business turnaround skills (14%).
Interestingly, unlike in other sectors such as IT, where over 90% of contractors find work through agencies, 62% of interims find assignments themselves. Only 38% of assignments come via an interim or recruitment provider.
Social media also plays a major role in finding interim work, as 26% of interim management contractors “have found interim assignments via clients who contact them directly over LinkedIn or other social networking sites”.
The report concludes by noting the “improving business climate” has lengthened assignments, seen pricing recover and kept more interims in work.