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Has lockdown triggered a City brain-drain?

Author: ICAEW Insights

Published: 18 May 2021

The explosion in home-working due to lockdown is shifting the focus away from a London-centric view of careers, with regional firms benefiting from a growing desire to shun the commute.

Lockdown is prompting a shift away from City jobs to opportunities at smaller, regional practices with talent-hungry boutique firms stretching to match City-level salary expectations for the right candidates, according to recruiters.

Recent research published by Deloitte found that more than one in five UK workers (23%) - the equivalent of 7.5 million - are hoping to work from home all, or almost all, of the time once lockdown restrictions have lifted, while 28% of workers don’t ever plan on working from home once lockdown restrictions have lifted, down from 50% who said the same in March 2020.

Anecdotal feedback from ICAEW members also highlights a desire to move away from large practice to something smaller and regional. However, with candidates reluctant to take a hit on salary, the mismatch between candidate and employer expectations could be a tricky circle to square.

Lorraine Twist, Director, Hays Accountancy & Finance, said as the intention to hire showed signs of ramping up, the affordability of housing would be a major factor in prompting candidates to consider job opportunities outside of the capital. 

“Some professionals have already moved out of London but are still retaining their positions and working remotely,” Twist told ICAEW Insights. “However, we predict this will change over time as most firms will likely offer a hybrid model of working instead of a full remote model when we return to ‘normal’. Those who have already moved will then need to endure a long commute two-three days a week or move to a more local position.”

Several of the UK’s largest accounting firms have already moved to adapt their working practices, adopting a range of positions along the spectrum of hybrid working: 

  • BDO has told staff to decide where they would like to work post-pandemic
  • Staff at KPMG are expected to spend four days in the office per fortnight from June
  • PwC has asked staff to be in the office two to three days per week
  • Deloitte has stated it will look to go down the hybrid working route, but has not released specific details

Twist said those looking to move would need to weigh up whether their location will take precedence over salary in the future. “Professionals who have worked in London are favouring a London salary in a more rural location, which is possible currently due to remote working – but it’s likely this won’t be the case for long. We are still seeing higher salaries offered in London and expect this to stay that way.”

Hayley Cox, Senior Business Manager, Finance & Accountancy at recruiter Sellick Partnership said the recruitment net was being cast very wide as companies continue to offer remote working with a small visible presence in the office. “Candidates at all levels are re-evaluating a career trajectory that once seemed inevitable and are now much more open to considering regional opportunities with firms that are able to offer a competitive package,” Cox said. 

“Without traditional geographical restrictions in place, candidates from all over the country have a really strong chance of being considered for any role they might apply for. While we are seeing some candidates based outside the capital applying for roles in London, we are also seeing those who have spent their career at firms with a national presence now seriously considering more localised opportunities,” Cox added. 

Cox said there was a real opportunity for smaller practices to land top-tier candidates who might have previously only considered opportunities within the capital. Boutique and specialist practices were in a strong position to offer highly competitive remuneration packages and in some cases make the stretch to match City-level salary expectations for the right candidate, she added. 

“Large firms in the capital will always be an attractive prospect for candidates in the early stages of their career, as they offer clear progression and training for those just starting out. Without as much bureaucracy in place, these smaller firms can be really flexible with the package they can offer - making them an attractive prospect for candidates looking to spend more time with their family,” Cox said. 

For experienced accountants who might be considering moving to a smaller or regional practice for a better work-life balance, it is always worth asking their current employer about what additional benefits and flexibility might be available, Cox advised.

With a significant shift in how experienced candidates are approaching their job search, employers of every size must look critically at the package they offer and how they can make it as attractive as possible for job seekers. Large firms in particular will need to adapt to the needs of their staff in order to retain the talent they currently have, and a forward-thinking and flexible approach is the only way to help ensure that staff who are attracted to the prospect of a different working environment don’t make the leap, Cox said.

“In the City – we are seeing firms increase their employee value proposition by focusing on wellbeing, work-life balance and offering hybrid working going forward to encourage staff to come into the office for collaboration,” Twist says. 

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