John Borrowman, CPC
Borrowman Baker LLC
Gallatin, TN 37066
There’s no doubt the recession hit BV practices, in some cases triggering layoffs. For the first time we can recall, the supply/demand pendulum swung in favor of the employer. From where we sit, however, demand for experienced professionals is back.
Two key drivers flow from a more confident view of the future. A third is part of the DNA of the profession.
Practice leaders face a unique hiring challenge connected to the fact that business valuation is a business of judgment. You can possess, and even use, the financial/analytical tools of the profession. But, if you haven’t used them in the profession, it’s just not the same.
Imagine an organizational pyramid, then draw a horizontal line somewhere between a fourth and a third of the way up from the base. Broadly speaking, candidates for positions below the line can come from any number of fields where those tools are used. Candidates for positions above the line can really only come from another practice.
This hiring challenge never went away. It was merely camouflaged by a temporary swelling in the labor supply. That swelling has eased considerably because of two factors; one internal and one external.
Practices have hewed to a conservative line in delaying their hiring. They have stretched existing resources about as far as they dare. Increased inflow of work, and the confidence that the pipeline will continue, has made it easier to justify additional payroll. Growth is once again the expectation. Expansion is driving demand.
As job opportunities also improve outside BV, replacement becomes a driver of demand. It’s normal that employees who have kept their heads down and worked hard while things were tough are beginning to notice, and think about, those opportunities. Even more problematic is that these employees are more likely functioning above that line in the hierarchy, triggering the unique pressure to hire only from within the profession.
Combine these variables with a real unemployment rate of only 4.1% (Bureau of Labor Statistics; January 2012) for the college-educated professionals demanded by the BV profession, and you can see why hiring demand is back. The question now is whether we return to levels of pre-recession demand.