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About In House Tax

About In House Tax

This weblog is a news and views site for tax professionals within the UK and international in-house tax community.  You will find information about appointments and people moves in and around the in-house tax market, issues affecting the in-house tax professional, opinions on the state of the tax job market, updates on tax technology, and other general thoughts of the day.

Hope you find it useful.

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Location: St Albans, United Kingdom

This site has been developed by Simon Godley, who also runs the niche tax recruitment company Talentpool Selection . Simon spends a lot of his time placing tax specialists into FTSE companies, large in-bound groups and some professional services organisations. He also recruits and is well networked around the UK tax technology and VAT markets.

Tax News

Chaos in the markets - and the tax jobs market?

Tuesday, 9 August 2011

So at the time of writing, there are a handful of European countries with a very precarious debt situation, the US economy seems to be floudering, the UK FTSE 100 has plunged nearly 20% in the space of a week, and there is rioting on the streets of London. Not a happy situation, and potentially very bad news for the corporate world generally, just when we thought the economy was under control after the 2008-2009 financial crises.

So as the shock and surprise of these events subsides, people will start to think, 'What might this mean for my job?' and ‘What might be the impact on the tax employment market?

The answer is very difficult to predict, particularly as this time the significant FTSE fall is in response to country financials rather than any corporate-led bubble. So I thought it was worth making some commentary, with the attempt to maybe calm a few nerves.

1. Firstly, we are not back into recession. We have been going through quite a fragile recovery since 2008, but we came out of recession in early 2010 and would technically need two consecutive quarters of negative growth to be back in recession. Significant private sector job losses usually occur in times of recession, and we are not heading there yet.

2. Large companies and the corporate sector have done a lot of cost cutting and reducing down debt since the 08-09 financial crises, and therefore corporate profit levels have been generally strong over the last couple of years, which has led to a much better level of recruitment activity over the last 12 months, and much fewer recruitment freezes.

3. As a result of the above, there have been strong levels of recruiting into the tax departments of the Big 4 and other practice firms, particularly into VAT / indirect tax, M&A and tax structuring teams, and also into the general corporate tax teams. Some specialist teams I know have gone from 5 to 12 members of the team in less than 2 years. I must note here that a proportion of this recruiting activity will be recruiting skilled tax people into gaps created by the redundancies of 2008-2009, however a large proportion is for future growth plans.

So I sense there is a current disconnect between positive corporate performance and the slump in the stock market, driven by wider international and macro-economic issues. Clearly there is a scenario that these negative economic issues around the Euro zone, coupled with our own heavy public sector cuts, could drag us back into recession. This would be bad for all job sectors, tax included, but let’s not panic – we are not Greece or Portugal, we have a much stronger employment market, and let’s see where we are in a few months.

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posted by Simon Godley


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