Chief of IMF Voices Concerns over US Default Causing Recession

World Bank News

Jim Yong Kim, the president of the World Bank, has also issued warnings about the potential consequences of the situation and the threat of recession. He has expressed his concern that the US is only a few days away from a potentially very damaging situation.

The bank's president was eager for the policy makers in the US to reach some kind of agreement over the debt ceiling before the deadline warning, that a failure to do so could be a 'disastrous event' and cause global recession.

He expressed his concern over a potential drop in growth and confidence and a rise in interest rates, and he had particular worries about the developing world. 

International finance ministers don't believe that the US will default, but there is a general uneasiness about the potential impact of the crisis and the looming threat of recession.

After the White House rejected a deal for a short-term increase to the borrowing limit, it is now a race to reach an agreement. The partial shutdown of the US government has been in place since they failed to pass a budget and has meant thousands of federal employees have been sent home.

The shutdown could be costing the government dearly, with an estimate from the US Treasury Secretary suggesting that it could be shaving 0.25% off economic growth with every week it continues.

Written by David Archer of Circle Square - Financial Jobs London / Accountancy Jobs London

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If the move towards shared services had a higher profile then the unions would protest, the media would criticise and the academics would find flaws. The sea of change around the way large organisations are now structuring themselves and outsourcing key services such as HR, IT, procurement and finance is happening very discreetly. Part of the reason why the change has been fairly gradual is because it's taken big organisations a long time to wake up to the advantages.

Shared Services a Cost Saving Solution

The Benefits of Shared Services Have Been Understated

A Common Perception is that Shared Services are Bad 

Despite this research has found little wrong with the shared services because it combines market principles with in-house control. Service providers can act in a dynamic and entrepreneurial way but are still accountable to the host organisation in the knowledge that if they get it wrong, they could lose the contract.

Shared-service agreements have generally been set up over time and their effect has also been gradual. However, they are changing the way companies operate, improving processes and enabling more communication between different areas of the business to ensure the organisation is far more joined up. It also enables companies to concentrate on their core business.

The Government is Encouraging Outsourcing to the Private Sector

Such is the effect of shared services that the government is now urging public bodies to go down this route by outsourcing to the private sector. It is encouraging hospitals, police forces and schools to set up shared-service arrangements. Whether they too can manage to outsource their recruitment or finance departments quite so quietly is another question.

Written by Victoria Campbell of Circle Square - Finance Jobs London / Accountancy Jobs London

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With glimmers of hope for the UK economy starting to appear, CFOs need to begin planning for the future. Many companies aren't making huge moves to expand or invest, but what areas should they be concentrating on?

Maintaining Cash Flow

It's important to keep cash within the business. Funding is still hard to come by, particularly from traditional lenders, so keeping money in the business is essential. Ensure you don't reach credit limits and that your business will still be able to operate if interest rates increase.

Ensure Good Returns

Many businesses have been putting money aside since the downturn so that they rely less on credit. As they've not been investing, large amounts remain in company bank accounts. It's crucial that you consider how these funds should be invested whether that's making acquisitions or continuing to save. If you're holding on to the money you need to find a good interest rate. For large investments, the money should be spread across different banks in case one goes under.

Large Debts

Lots of companies took on too much debt during the good years and are now struggling with this burden. They're often referred to as 'zombie companies', as they've got little chance of paying off the debts. The loans may have been sold to new lenders who will look to restructure the company's finances and agree new payment plans.

The Eurozone

Prepare for the Future

Global Markets

More companies are looking beyond Europe for their next growth market. For this you need to think about the different approaches you may need to adopt, based on financial restrictions or local customs. Approaching new markets through a local partner or franchise model could be options.

The Real Cost of Sick Days

UK Staff Take Almost Double the Sick Days of US Workers

The survey results showed that staff in the UK take off 9.1 days on average every year for sick days. This is almost double the time that US workers take off, at 4.9 days a year for sickness absence. It is also four times as much sick leave as staff in the Asia Pacific region, who take 2.2 days. It is also higher than in the rest of Western Europe, where the average is 7.3 days.

In fact, sick day absence equates to around 90pc of UK business's bill for absence overall, which includes figures for industrial absence, compassionate leave and other reasons.

The Overall Cost for Sick Days Has Risen Too

The trend may be improving very slightly, with unscheduled absences in the UK dropping to 9.8 in 2013, compared to 10.1 days two years ago. However, the figures attributed to sickness have risen to 9.1 days this year, from 8.7 in 2011. At the same time, the overall cost of those sick days has risen too, accounting for  28.8 billion of the country's overall  31.1 billion bill for workplace absence.

Finance Drain for UK's Business

The PwC lead for HR consulting, Jon Andrews, said that absence still led to a big resource and finance drain for the UK's businesses, particularly at a time when companies should be striving for growth. Businesses need to find ways to improve staff morale, motivation and health to improve the figures potentially by increasing workplace flexibility to cut back on the sickness cycle.

He pointed to forward-thinking businesses that were investing in their health and wellbeing provision for staff to tackle the issue at its roots, before its effects began to hit the bottom line. This is particularly important for SMEs and start-ups, where absence costs can be particularly challenging.

Workforce Demographics Playing a Part

Another challenge is the change in workforce demographics, with the overall staff profile ageing as more people are forced to work for much longer before they are able to retire. This means that businesses that fail to take steps to address the issue now are likely to see escalating sickness levels.

In terms of different industries, the sector with the lowest sickness record was the technology sector with an average of 3.4 days a year, which three times lower than the 11.1 recorded for public-sector workers.

Written by Rachael Clarke of Circle Square - Financial Recruitment

To contact one of our specialist financial recruitment consultants call 0207 492 0700 or email: jobs@circlesquare.co.uk. 

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The Summer Employment Slowdown - Myth or Reality?

Depending on how you interpret the Employment slowdown, it can be both. The summer slowdown has been a genuine problem for the US economy over the last few years. However, the data revealed in the ADP's National Employment Report (July 2013) indicates that this year it may be avoided as job-growth figures remain strong, but some industry sectors might struggle to fill their new positions. Whether it's a healthy or a struggling jobs market, the myth or reality of the summer employment slowdown is not to do with whether the jobs are there or not. It is simply the experience of delays at that time of year. 

Recruitment - A Question of Logistics

Candidate Availability

Keep the Employment Process Moving

Candidates should keep searching during summer. Be available - isn't it more important to secure a job than go on holiday? Be patient - expect the process to take a little longer. Consider temporary roles. Many companies backfill their summer employment shortages with temporary staff  This is a great way to get known within the company and these can sometimes lead to full-time positions. Remember the process can just as easily speed up as it can slow down as companies take advantage of staff availability before their holidays. So it really can pay to keep searching for employment over the summer.

Recruiters - Plan the Employment Process in Advance

If you plan to hire over summer get your process rolling straightaway. Plan interview dates well in advance so you know which staff you have available to conduct them. It may be significant to see which candidates will forego or interrupt holidays to secure a job and which let holidays take precedence. Source your ideal candidates well in advance if you are looking for college or university graduates. They will be keen to know they have secured employment.

The Thomson Reuters Investment Banking Landscape as of July 12, 2013

Investment Banking - the number of Italian companies involved in mergers and acquisitions was up by 30% so far in 2013, with a total value of $30.6 billion. LVMH have acquired an 80% stake in Loro Piana SpA, the cashmere clothing producers at a cost of $2.6 billion. 

Increase in Italian Investment Banking

This means that Italian involvement in the consumer staples market is up to 9% of total activity compared to only 2% this time last year. The majority of merger and acquisition activity undertaken by Italian companies this year has been in the financial, industrial, energy and power sectors, accounting for 72% of overall Italian involvement compared to 74% last year.

Dominating the field in a financial advisory capacity for the Italian mergers and acquisitions was Goldman Sachs, overtaking last year's top contributor Mediobanca and keeping Deutsche Bank off the top spot as well.

US Mergers and Acquisition Rate Falls

Despite a $2.5 billion bid by Kroger for Harris Teeter Supermarkets, the US rate of retail mergers and acquisitions has only reached $12.7 billion for the year to date. This is a decline of 31% on last year's rate, although the total US target mergers and acquisitions has reached $457.3 billion this year, which is up 21% on last year. Around 88% of all US target mergers and acquisitions are by US buyers, which is an increase on last year's 75%. At 18% of all mergers and acquisitions, healthcare is at the forefront of activity so far this year, with energy and power accounting for 15% and real estate in third with 12%.

As Harris Teeter's advisors, JP Morgan remains in the top spot for US target mergers and acquisitions, with Goldman Sachs coming in second and Bank of America Merrill Lynch coming in third in their role as sole adviser to Kroger.

Reduction in Global Investment-Grade Debt

General Electric Capital Corp has this week made a $3.5 billion corporate bond offering, the largest issuing of global investment-grade corporate bonds since June, when $6 billion was raised by Chevron. This brings the strongest weekly total for global investment-grade debt since early June, standing as it does at $14.4 billion. There has been a 3% annual decline on overall global investment-grade debt in the corporate sector, with a total of $1.5 billion to date.There has been an 18% decline in global investment-grade debt from European issuers, whilst in the US it has increased by 19% in the year to date. Morgan Stanley has moved up from sixth place to top the rankings for financial advisors involved in mergers and acquisitions.

If you're not sure which career move would best suit your skills and experience take a look at our Job Profiles. The profiles provide advice on the qualifications, skills and experience required for each career option. The job profiles also outline salary expectation, job responsibilities and career progression.

M&A Analyst      M&A Associate      M&A Director      M&A Vice President

If you are looking for advice we have a dedicated career advice section. Our advice is not just generic recruitment advice we have tailored advice for each of the recruitment divisions we work in including: executive search, accountancy & finance, temporary & interim, Real Estate, private equity, capital markets & M&A. 

To view our M&A Jobs

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What to Do When a Headhunters Calls

A Headhunters Call is Both Exciting & can Offer Many Benefits

Establish the Headhunters Relationship with the Employer

The Role of the Headhunter is not Career Coach or Advice Giver

They have contacted you because they want to make a sale. Of you and your skills. They are brokers. The negative associations some people have about them are because of these assumptions that they have magical powers and job seekers need them. This is not true it is a two-way street. 

If you decide to proceed with an executive search partner, they should never try to hustle or spook you into believing you would be lost without them. Should such tactics be used, back away. Getting a call from a headhunter is a sign to you that you have the power and if you choose to work with them to advance your career  you can harness that power to your advantage.

Relaxed Planning Laws... New Policy

The Relaxed Planning Laws also Apply to Agricultural Buildings

Local Authorities Exempt from the Relaxed Planning Laws

Following a thorough assessment, Mr Pickles announced in a written statement on the 9th of May that only 17 local authorities would be exempt from the relaxed planning laws, with six outside of London. These were: Manchester City Council; Ashford (Kent), Vale of the White Horse and Stevenage borough councils; Sevenoaks and East Hampshire district councils. The London authorities are the Boroughs of Westminster, Wandsworth, Tower Hamlets, Southwark, Newham, Lambeth, Kensington and Chelsea, Islington, Hackney and Camden, together with the City of London.

Could the New Legislation Affect Availability of Office Space

There is concern amongst critics that the new rules could adversely affect the availability of office space, particularly in residential areas of high value where office space would be profitably converted to housing. Comments have also been made that allowing offices to become homes could drive shoppers away from the high street and into retail complexes away from the town centres.

Moreover, in some cases planning permission would have to be obtained for the more extensive additional works needed to complete conversion from B1(a) to C3 status. In cases where planning permission is not required, there is the issue that local planning authorities will not be able to secure the additional finance required to invest in the appropriate social infrastructure needed to support the new residences. 

Talented Accountancy & Finance Recruiter

Manager - Contract Recruitment (Or Senior Consultant) invited to share in our wealth:

Established in 2004, our business has gone from strength to strength; from being a finalist in ‘Newcomer of the Year’ in 2006 we have grown to be nominated for Search firm of the year in 2011 and most recently accepted onto the National Growth Accelerator Program which is aimed at High Growth companies whom will add head count and value to the UK Economy.

Circle Square Talent is on a strong track to build and sell within three to seven years, netting everyone in the business a lump sum. Our financial performance and the strength of the team set us apart from the competition and everyone in the team is on a learning journey.  We are looking for Entrepreneurs not small thinkers.

Our proposition to you:

Take on more responsibility, learn and work amongst some of the best recruiters in the London market. We will offer you the freedom and opportunity to realise your full potential and in doing so become a fully fledged partner in this business.

Training & Development:

Your training will encompass two areas:

• Personal Development: We will help develop behaviours that will increase your confidence and make both your personal and working life a happier and a highly productive experience.
• Hard Skills: Training is on-going as we want you to advance to the next stage of your career. You will always be training for the next level.

Remuneration:

We offer a top-end package unrivalled in the market. Call us to find out more.

Why us?

Our best resource is our people.  With the right training and the freedom to develop, we can produce some of the highest fee earners in our industry.  This is a passionate business which thrives on your personal success, professional development and team culture.

Our requirements for this role:

• A demonstrable sales track record (in recruitment);
• An entrepreneurial, passionate and committed approach;
• Excellent written and verbal communication skills
• ENERGY and DRIVE are musts
• A good work ethic and desire to lead by example
• Management experience or potential to manage essential

Your duties:

• Managing a team of 2 consultants
• Working on our Contracts desk your week will be varied
• To build a successful temps desk with part qualified and qualified temps working on a regular high volume of temps out and maintaining good margins.

  All aspects of BD and negotiation

• To excel in the provision of a high quality service with our clients and with the best candidates;
• Building long term relationships with clients.
• Negotiating pay and charge out rates and finalising arrangements between client and candidates;

Behaviours Required:

• Fast paced – ability to work at the fast pace of a temps controller
• Tenacious – the ability to see things through to the end
• Confident in all dealings with people
• Strong communication skills (written and verbal) – will be tested
• Ability to think laterally and solve problems
• Resourceful – can you look at other ways to provide a solution?
• Hungry – you must want to make money and to be 
• successful
• Commercial – we are a company of entrepreneurs
• Target orientated – you package will be targeted towards results
• Competitive – we all love a bit of competition
• Pride – are you able to take personal pride in what you do
• Desire to learn – there will be a steep learning curve ahead
• Team orientated – we are a team of strong minded individuals
  • Positive attitude – we are a happy team which really on everyone being positive
  • Personable with good rapport building qualities
  • Ability to network outside of your comfort zone
  • Reflective – can you look at yourself and find where you could be better
  • Organised – structure is important to what we do
  • Entrepreneurial / Innovative – can you think outside the box
  • Strategic and forward thinking – what happens next thinking – looking ahead
  • Non-confrontational in approach and voice
• Ethical – we highly rate doing things the right way

How to apply:

Please contact David Archer for an informal and confidential chat on 020 7492 0718 or 07780 616 050 or forward on your CV to david.archer@circlesquare.co.uk

I am happy to take calls outside of office hours.

Eurozone's Bailout Fund Bailing Out the Banks

Under the agreement, the European Stability Mechanism will be able to inject up to 60 billion euros into bailing out the banks that are struggling, rather than allow them to go under. The total rescue fund is worth 500 billion euros.

Allowing the ESM to shore up struggling banks is a move away from past policy. Previously, the ESM had only been allowed to bail out national governments rather than European banks. 

This new banking rescue plan to stabilise the eurozone agreed just four months after the Chancellor, George Osborne, announced the UK banking reform bill going to parliament.

Eurozone Banks Face Bigger Losses Than Their Governments Can Cope with

In some of the countries which have suffered financial collapse, it was the banks that needed help. For example, the governments of the Republic of Ireland, Cyprus and Spain received bailouts but they in turn had to use the money to rescue their own banks. That could have unsettled the markets, with fears that the banks in the eurozone might suffer losses bigger than their governments could cope with. The problem is made worse by the fact that many of the governments are dependent on their own banks to lend them funds.

National Governments Across the Eurozone Relied on for Bailing Out the Banks

The rescue package is designed to break a 'chicken and egg' situation, where the governments depend on their own banks for funds and the banks depend on their national governments to bail them out. It's intended to spread the risk of a bail-out across the whole eurozone, rather than allowing individual countries to fend for themselves.

Limits Set on Bailing Out the Banks 

However, the eurozone governments with stronger economies have raised concerns about their level of risk. Led by Germany, they have sought to limit to the amount of funds the ESM can supply. This means that the national governments of those banks which have been bailed out will still take the biggest risk.

Big Depositors May be Expected to Contribute

The terms of the new directive includes a so-called 'bail-in', where the banks' shareholders, lenders and even big depositors may be expected to make a contribution before any ESM funds are released.

Fears of a New Financial Crisis

Written by David Archer of Circle Square  -  Investment Banking division

If you are looking for advice we have a dedicated career advice section. Our advice is not just generic recruitment advice we have tailored advice for each of the recruitment divisions we work in including: 

executive search, accountancy & finance, temporary & interim, Real Estate, private equity, capital markets & M&A. To view our M&A Jobs

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