CWS 3.0: December 21, 2011 - Vol. 3.37

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U.K.: Bright Outlook for Procurement Professionals

The New Year is a traditional time for people to pause, evaluate the past year and consider their plans for the future. Many New Year’s resolutions will focus on career transition and, accordingly, January is always the hottest month for job placements.

So with this in mind, what does the current employment market look like for procurement professionals? If the past year is any indication, 2012 looks to be quite promising.

Figures compiled by Hays Procurement and the Chartered Institute of Purchasing & Supply (CIPS) show that there has been a significant increase in demand and reward for procurement and supply management professionals in the U.K. during the course of the past year. Their research, published Dec. 5, shows that the number of procurement and supply chain job vacancies rose significantly in the second quarter of 2011, up 33 percent from the second quarter of 2010. Vacancies for procurement officers increased most sharply (200 percent) followed by senior buyers (110 percent) and procurement managers (75 percent).

There were regional variations with the highest concentration of procurement vacancies in the South East (22 percent) and London (18 percent), followed by the Midlands (12 percent) and the South West (12 percent).

The Hays/CIPS research found that growth was strongest in the automotive manufacturing sector, up an average of 73 percent per quarter in the first half of the year. However, recruitment firm Langley Search & Selection asserts that average pay for procurement specialists within the financial services sector has jumped by 5 percent over the last year while pay for peers in other sectors has remained broadly flat. Christina Langley, managing director of Langley, adds: “In the post-credit crunch environment, banks have been in an almost constant struggle to improve their cost to income ratios.”

While five out of six available procurement jobs remain within private companies, there was a notable increase in the number of public sector vacancies, with an average 29 percent increase in the first two quarters of 2011. Procurement seems to be immune from the severe job cuts being experienced in the public sector (predicted to reach 610,000 by 2014 or 2015) given the pressure within the public sector to reduce costs.

These increases also reflect an on-going trend of procurement becoming recognized as a high-level strategic function within organizations during the past decade, shown particularly in terms of salary increases. According to Hays Procurement, the number of senior procurement jobs with advertised annual salaries of between £75,000 to £100,000 (approximately US$118,000 to US$157,000) rose by 35 percent in the first half of 2011. Similarly, 60 percent of respondents to the CIPS/Supply Management Profile of the Profession Survey earlier this year, reported that their salary had increased in the past 2 years. An overwhelming 86 percent said their procurement department was doing more than it was 5 years previously, and 39 percent said they report to a higher level of the company than they did 5 years ago.

Contingent Workforce Procurement Vacancies

Good opportunities are undoubtedly available for experienced procurement professionals, including those specializing in the contingent workforce category. Our own analysis of two U.K. job boards specializing in procurement vacancies — www.peopleinprocurement.net and www.theprocurementjobsite.co.uk — revealed no less than 87 jobs currently being advertised for contingent workforce procurement managers (job profiles that include contingent, HR or indirect responsibility). The average salary offered across these current vacancies is £50,900 (US$79,600) ranging from as low as £22,500 up to £85,000 (US$35,200 to US$132,900).

With an average of 20 applicants per procurement/supply chain job, compared to an average 30 applicants per human resources job, the data from Hays and CIPS also suggests that, while there may be competition for jobs, it’s not quite as competitive as other careers. An overwhelming majority (94 percent) of procurement professionals surveyed for the CIPS Supply Management survey earlier in the year said that they would recommend purchasing and supply as a career.

"The financial crisis and continuing uncertainties weighing on the global economy have led many companies to review their business strategies and to expand parts of their operations that ultimately help them to reduce costs and ensure the sustainability of future growth,” says David Noble, CEO of the Chartered Institute of Purchasing & Supply. “Meanwhile, recent scrutiny of government procurement strategies has led to more strategic employment in the sector. This entails much more than finding the cheapest possible solution, and needs people with the skills and knowledge to understand the true value that procurement and supply management professionals add to the reputation and success of the organization, along with robust risk management strategies."

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