Congratulations to the motor industry in 2007 Ė I donít know how you all did it, but against such an inauspicious background to come up with one of the best years on record is impressive.
With only a few weeks to go before the end of the year, I talked to many of the groups - the feeling was that it had been an average year in terms of volume; in terms of profitability it had been dire. We had seen, for instance, two profit warnings from Pendragon during the latter half of 2007. Other groups will probably not go that far (looking at their share price, the City has obviously gone with the maxim that one warning is unfortunate, two is careless) but for the largest player in the industry to suffer quite so publicly really tells us that the market is not strong.
So despite the bright and breezy spin put on these figures by vested interests (similar interests are telling us how much house prices are going to rise this year too) most groups are anxious about the year ahead. We might have registered a lot of cars last year, and yes we might even have sold some of them, but dealer profitability has suffered terribly.
Which brings me to my recruitment paradox. Recruitment consultants, especially at the top end, have two periods of really strong performance, and neither of them are when the market is really booming. I have seen a few cycles since running this business and it always happens the same way Ė when the market is on the way up and on the way down we always perform well. When it is at the peak or at its lowest ebb it is more challenging.
Why? Because on the way up or down there is a resource balance in the market Ė broadly speaking there are plenty of jobs to fill and candidates available. On the way up new jobs are created, on the way down, plenty of messengers are shot and vacancies (not jobs) are created. At the very top there is always a candidate shortage, and a million and one recruitment consultants appear, and at the bottom no one recruits much.
And we are as busy as we have ever been at present, with demand for really good candidates very high. In fact we reckon that demand has picked up substantially since September, which is great news for us, but not necessarily so for my readers. Because looking at all of the other evidence, I donít think any stretch of the imagination would call this a rising market this year.
Most of the activity is at General and Regional Management level, and there is also a considerable pick up in business outside of the UK. Not surprisingly the Middle East and to a lesser extent the Far East are booming. Oil prices rising and markets rising 20-30% year on year for several years will generally do it, and that is where places like Dubai and Abu Dhabi have got to.
Which is why we will probably send an increasing number of people out to that part of the world this year and it will continue to attract some of our best talent for quite a few years to come. It will happen even quicker of the pound falls off its pedestal and starts to weaken, as everyone else will look even more attractive, especially in a tax-free environment.
But look on the bright side Ė such emigration means more chances over here to develop careers, more opportunities to step into a more senior role, and though the market may not look as good as it did, anyone who can perform in this environment will be in heaven when the good times return.
Donít forget that for all their current problems, our largest group, Pendragon, really established its reputation in the early 90ís, and the early 90ís was a scary world to work in for this industry.