Protecting the UK Staffing Industry During Coronavirus

The professional recruitment sector has been badly impacted by Covid-19, and APSCo has engaged closely with the government to raise awareness of the challenges our members – and indeed the wider recruitment sector – face.

This has included an open letter to the prime minister that highlighted the vital importance of the professional recruitment sector to the UK economy, and the need for UK businesses to have recruiters ready to get people into work on the other side of the current outbreak.

The letter was prompted by a survey we undertook to understand the situation on the ground in order to help us feed into policy decisions with the best data possible. The first of our surveys on the 23rd March showed the following situation within the sector:

  • Two thirds (67%) of recruitment firms said permanent hiring within their sector was on hold
  • Almost 90% of recruitment firms said that up to 50% of their contractors had already been terminated
  • Three quarters (76%) expected up to 50% to be terminated by 29th March
  • 83% of recruitment firms were considering redundancy for their own staff
  • Three quarters (76%) said that help with salaries was the most important measure that the Government could implement

In the letter, we called for more clarification around the initial proposed measures and encouraged the government to look at additional support such as an Employers’ NICs holiday or VAT relief. We also suggested looking at what the German government had done in terms of help with the payment of salaries – and asked the government for clarification on how it will support self-employed professionals.

PREMIUM CONTENT: EMEA Covid-19 Legal Update

Thankfully, most of our questions were answered, with the Coronavirus Job Retention Scheme guaranteeing that the government will pay 80% of salaries for furloughed permanent employees and self-employed professionals. This will avoid countless redundancies and ensure businesses can stay afloat throughout the worst of the pandemic. In fact, the letter was so well-received that it led to a call with a senior business adviser to the prime minister.

Our second survey of our membership found firms were struggling to access the Coronavirus Business Interruption Loan (CBIL), and showed that demands for personal guarantees, offers of alternative loans, and inflated interest rates were making it harder to access much needed funds. Over a third of those who felt that the CBIL could benefit them either did not know how to access it,found the criteria prohibitive or the process too complicated and difficult.

This led to a swift response in the form of an open letter to the chief executive of the British Business Bank to call for a more responsible approach from the banking sector towards firms seeking the Coronavirus Business Interruption loan.

Therefore, we welcome the chancellor’s intervention to enable businesses to gain fair and rapid access to business finance via the CBIL. The fact that he has banned banks from asking for personal guarantees for loans under £250,000 makes it clear that organizations should be able to apply directly without unnecessary impediments. Furthermore, we are also encouraged by the latest guidance from the government on the Job Retention Scheme, particularly with regard to public sector contractor assignments.

One Step at a Time

While we are encouraged by the action that the government has taken so far,we are continuing to review the situation daily in order to inform our members and lobby for the best possible actions from decision makers.

Our communications have been heard at the highest level of government, and by continuing to feed relevant data from our membership into government departments so that they can make informed policy decisions, we hope to help mitigate the worst effects of the pandemic on the recruitment sector, and ensure that it can help the UK get back on its feet in the future.

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Ann Swain

Ann Swain
Ann Swain is global CEO of APSCo.

Ann Swain

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