Cutting Recruitment Budget

Civil servants may be required to continuously educate ourselves

According to the agency RIA Novosti this initiative was proposed by the Ministry of Labor. Dmitry Akopov, CEO of Jacobson Partners discussed this with Kommersant FM anchor Oksana Barykina. |  June 10, 2015

Transitional period

One of the most important indicators of the economy is the demand for automotive products. According to experts, by September car sales in Russia fell by 12.7% in the first eight months of the year. Hard times came both for the automakers and related sectors related to the automobile industry. Under these conditions, the larger the company the harder it is to change for it in a short time. Experts point out that many companies are focused on improving the efficiency of the management. Active changes are taking place at AvtoVAZ, the largest automaker not only in Russia but also in Europe. Its production is the best-selling in Russia: about 250,000 cars were sold within eight months of this year, accounting for about 17% market share in Russia. Sales of Renault over the same period were half less. |  October 02, 2014

Investment Profit

Forestry enterprises face a difficult situation. On the one hand, the Soviet-era model of forest management requires extensive investments in the development of new territories. On the other hand, it is necessary to change the obsolete equipment and introduce foreign technologies. In addition, electricity tariffs are going up and services of competent professionals are expensive. We need to change the system, but not to cut costs, experts say. |  March 25, 2014 |  December 26, 2013

Cutting Recruitment Budget

During the crisis, marketing and recruitment budgets are cut first.

A quarter of Russian employers will reduce recruitment next year. Another 5% will cut staff. That is the conclusion made by ManpowerGroup and Penny Lane Personnel. Dmitry Abzalov, President of the Center for Strategic Communications and Dmitry Akopov, CEO of Jacobson Partners discussed the situation with anchorman Andrei Norkin.

Mining and processing industries will suffer most. The insurance sector and IT-companies will be better-off.

- Mr Abzalov, do you agree with the findings of your colleagues?

Ab: These conclusions were obvious and predictable. Obviously, the crisis will affect the services market indirectly, which includes, inter alia, insurance. If it does, it will affect, first of all, those segments which are related to promotion of goods, that is, marketing structures. As for the financial and insurance market to a bigger extent, as well as other segments, there will be no such difficult problems as in metallurgy and chemistry.

- Mr Akopov, what is your opinion?

Ak: I absolutely agree with my colleague. What do people do during the crisis in the first place? They reduce marketing budgets, recruitment budgets and costs of all sorts for services which are complementary. So it is true that advertising budgets will be reduced, and the people engaged in selection of staff, unfortunately, will not be needed in times of crisis and staff reductions. In particular this will affect the recruitment industry itself, in particular the lower and middle segments.

- Which professionals may be under the threat of dismissal, do you think?

Ak: It all depends on the industry and directly depends on the company which does it. As an example, dozens of billions of dollars were invested in the industrial sector over the past few years, and new production facilities were built. Accordingly, those older workers who are not adapted to use new production facilities, unfortunately, will be made redundant. Many workers are now called operators and they, unfortunately, will be made redundant as well.

- Mr Abzalov, who else do you think is facing this threat?

Ab: Actually, it depends on the specifics of the industry. For example, it is clear that the banking sector is running the risk, particularly financial institutions. This is due not so much to external factors but internal factors, first of all, the activities of the mega-regulator. Let me remind you that active revocation of licenses, of course, leads to redundancies in the industry.

As for other segments, by the way, the recent decisions have affected very painfully the event segment, that is, entertainment. This is primarily due to corporate events, and a variety of other events. It is clear that this sector will also be affected. And not only state-owned companies will be affected. Cost reductions are underway, because entertainment is also going under the knife.

Those companies that might benefit next year could be infrastructure companies which will be involved in the construction of railways. Let me remind you that next year huge money will be invested in the Trans-Siberian and Baikal-Amur Mainlines. Those companies which are engaged in infrastructure construction in this segment will get certain advantages. In addition, significant funds are allocated for construction of the ring road, which will be built in the Moscow region, so I think Rosavtodor (the Federal Road Transport Agency) is not going to face redundancies. The same goes for construction companies operating in the infrastructure for road construction. Moreover, the IT-sector is of course, one of those sectors which are actively growing. The market is not full, plus the problems with Ukraine which provided workforce, so partial outsourcing will be present here as well. So I would describe these sectors as recipients of a favorable economic situation next year.

- Mr Akopov, which experts do you think will be in demand next year?

Ak: Let alone those sectors which are funded from the state treasury, and if we talk about businesses, top-managers will certainly be in demand, and those are senior managers with a focus on crisis management. Not all top managers, who are employed in companies, particularly in industrial ones, can and know how to handle crisis management and take anti-crisis steps. In particular, if we continue talking about top managers, Economics and Finance directors will be in demand, those oriented on the economy – people who understand production redistributions, know how production costs are formed, how to handle those, how to cut costs and how to optimize processes during the crisis.

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