Direct Tax Market Report Q2 2022
Jun 29, 2022 - Tax Market Report, Industry Insights
The end of Q2 usually signals what’s commonly known as the quiet period in the recruitment space, the summer holidays primarily being the cause. But, there’s been nothing normal about the job market over the last 2 years, so demand for tax professionals across all disciplines remains high.
Retention has been tricky for many firms within this competitive market, which has led to industry powerhouses deepening their pockets to both attract and keep talent. Most recently, PwC has announced that 70% of their employees will receive a 7% increase, with reportedly 50% getting a rise of 9% or more. Smaller firms are providing staff generous cash rewards and the majority of employers have now fully committed to agile working.
Outside of remuneration packages, the employers with the highest success rate in filling roles are those who act quickly in their recruitment processes. A by-product of firms having a record level of roles advertised seems to be a lack of resources in recruitment areas. Although somewhat outdated, Glassdoor research discovered that it takes an average of 23.7 days to hire from the time an application is sent.
Working with some of the UK’s top firms, we can safely say
that although some are in line with this timescale, the majority remain far
off. What this means is that those candidates in several interview processes
are very unlikely to wait around at the jeopardy of having offers withdrawn.
A big topic of conversation has been the news of EY planning to split its audit business off from the rest of the firm. For tax, this could be a great opportunity for those in senior positions. Long has there been a common gripe about losing key clients to the audit business. Alternatively, it could also be an opportunity for mid-tier firms to capitalise. Being a ‘one-stop shop’ could appeal to clients who want to avoid multi-contract negotiations.
Q2’s Key Highlights
- Q1 had a large uptick in part-qualified & newly qualified corporate tax candidates. Q2 couldn’t be more different, as Managers, Senior Managers and Directors have been most in demand.
- Private client tax professionals at the Manager grade or above have been highly sought after, especially by mid-tier firms. There has been plenty of movement in these areas, particularly with people moving to the top 10 firms offering extremely generous salaries.
- Most new roles have arisen to replace employees who have left or to increase the firm's resources to take on more work.
- Transfer pricing positions have decreased after a few months of successful recruitment drives. Overseas candidates with visa sponsorship requirements have filled this gap, predominantly in the top 8 firms. Interestingly, there’s been a higher demand for TP professionals in law firms, which have much higher salary bandings than accountancy practices.
- R&D Tax professionals, particularly those from established firms, have been sought after up and down the UK. HMRC is cracking down on R&D tax claims and in turn, those who have the technical expertise and experience are worth a lot right now.
The cost of having so many positions must be astronomical and, with a sustained candidate shortage, it’s unlikely that these positions will be filled overnight. What will be crucial for employers going into Q3, is retaining their staff by going the extra mile.
Private client tax recruitment will see a continued reassurance after a quieter year. Corporate tax will continue to steamroll as the most in-demand area, whilst ultra-candidate short areas of tax such as employment tax and partnership tax will be a challenge for recruitment teams.
Closing off this Q2 summary, the prediction is that this summer will be the most active summer job market in recent times. News headlines will talk of pay rises and record benefits, but firms will also become cautious about a potential recession on the horizon.
Ed Moore is a Principal Consultant in the Tax Division at Harvey John.
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