2009 - CRE

Ivan Myachin /
Иван Мячин
By­August­2008­investment-developmentand­construction­companies­were­forcedto­start­freezing­their­projects,­had­toadjust­or­suspend­recruitment­of­employeesand­rethink­their­overall­business­developmentstrategies.­Those­employees­who­in­June­were­"worth­their­weight­in­gold",­and­for­whoseservices­
companies­ competed,­ sometimesoffering­
unreasonably­ high­ wages,­ foundthemselves­
in­ low­ demand.­ Changes­ startedhappening­in­the­CRE­labor­market,­just­like­inother­markets.­Job­seekers­were­facing­a­newmarket­environment.­In­the­last­year­and­a­half­or­two,­companieshad­been­placing­their­bets­on­the­future.­Manyplayers­were­facing­staff­shortages­and­thus­hadno­choice­but­to­start­developing­their­teams,creating­a­so-called­'labor­reserve'.­However­thecurrent­situation­has­forced­many­to­optimizetheir­business­expenditures­and­adjust­theirstaff­sizes­in­order­to­reduce­labor­costs.­The­trends­which­began­in­2008­have­continued­in­the­new­year.­By­early­2009­many­companies­operating­in­the­Russian­real­estate­market­reduced­their­staff­numbers­by­an­average­of­10-40%.­According­to­our­findings,­the­averagereduction­of­salaries­has­often­reached­30%,­andhas­hit­all­levels­of­management.­In­some­cases,salary­reductions­have­reached­50%.­
In­ early­ February­ 2009,­ ANCOR­ Holdingconducted­a­survey­of­job­seekers­in­Moscowand­
St.­ Petersburg­ in­ order­ to­ find­ out­ theimpact­of­the­crisis­on­employees­and­how­theyfeel­about­the­measures­being­taken­to­cutstaffing­expenses.­The­survey­was­conductedamong­4256­individuals,­including­both­theemployed­and­those­seeking­work.­The­majority­of­respondents­(72%)­–­were­professionals­
and­ middle-level­ managers.­ The­ surveyshowed­that­70%­of­respondents­which­havekept­their­jobs­in­one­way­or­another­have­alsobeen­affected­by­the­staffing­expense­reduction­measures.­The­most­common­was­a­reduction­in­salary­levels,­followed­by­cancellationof­bonuses,­social­packages­and­other­supplementary­payments.­With­such­drastic­measuresbeing­implemented­by­almost­all­companies­itis­important­to­understand­what­the­averageworker­would­like­to­see.­The­study­showed­thatthe­measures­taken­by­employers­are­viewed
#06 (112) / 16–31.03.09
| Business Technology |
| Personnel |
|North–West |
| Regions |
An inside look: the CRE labor
market through the eyes of job
seekers
Ivan­Myachin,­Director­of­ANCOR­Real­Estate­&­Construction­Company
Anna­Khrustaleva,­Head­of­ANCOR­Real­Estate­&­Construction­–­St.­Petersburg­
­ Starting­in­the­second­half­of­2008,­the­long­established­order­in­the­labormarket­fell­apart:­stopping­the­'overheated'­market­cold­in­its­tracks­and­forcingjob­seekers­and­employers­to­take­into­account­each­others­interests.­
unfavorably­by­employees.­How­can­a­companymaintain­employee­loyalty­in­such­a­situation?­The­study­found­that­employees­remain­loyal­ifthe­management­has­made­an­effort­to­informthem­about­the­company's­plans­during­thecrisis­period­(66%).­In­addition,­more­than­halfof­those­polled­said­that­they­would­be­moreloyal,­despite­negative­changes,­if­their­manager­
discussed­ with­ them­ their­ future­ prospects­and­development­within­the­company.­The­number­of­people­who­were­prepared­to­domore­work­for­the­same,­or­smaller­salary,­wasalmost­the­same­as­those­who­were­not­–­26%and­31%­respectively.­In­our­continued­talks­with­job­seekers­inrecent­months­we­have­started­to­see­an­increasein­
emotional­ tensions­ and­ stress­ fatigue­ inmany­professionals­that­work­in­the­CRE­sector.­The­internal­psychological­atmosphere­in­acompany,­the­ability­to­survive­a­difficult­periodwith­minimal­losses­as­well­as­future­development­during­the­subsequent­recovery­period,to­a­large­part­depend­on­the­joint­actions­ofmanagement­and­the­HR­manager.­
Lower­ business­ activity­ has­ led­ to­ lessdemand­for­specialists,­and­consequently,­anincreased­number­of­applicants­for­each­available­position.­As­a­result­of­the­increased­number­of­applicants­for­each­position­their­salaryexpectations­are­becoming­lower­in­order­tocompete­for­the­jobs­available.­People­seeking­work­now­have­to­considerlower­wage­levels­than­they­originally­planned
46%
and­46%­of­the­respondents­are­willing­to­lowertheir­salary­demands­by­as­much­as­10-20%.In­addition,­more­than­half­(56%)­are­willing­to­work­for­half­pay­or­part-time.­
72%­ of­ the­ respondents­ were­ willing­ toconsider­taking­jobs­outside­their­specialty­andundertake­retraining­or­a­career­change.CRE­sector­companies­first­reduced­theirnon-administrative­departments­–­HR,­marketing­and­advertising,­accounting,­financial­and­ITservices.­As­a­rule,­specialists­that­work­in­thesefields­have­a­smaller­dependence­on­the­CREsector­and­have­greater­flexibility­to­move­andadapt­to­new­circumstances­and­find­opportunities­in­other­industries.­So­we­can­easily­predicta­large-scale­and­cross-sectoral­movement­ofprofessionals­that­work­in­these­fields.­To­a­greater­degree­staff­reductions­had­thegreatest­
impact­ on­ those­ who­ were­ recentlyhired.­These­were­in­the­'staffing­reserve'­whichthe­company­was­forming­to­take­advantage­offuture­opportunities­in­a­rapidly­growing­market.­First­to­go­were­real­estate­professionalsengaged­in­the­search­and­acquisition­of­landand­real­estate­for­future­development,­projectand­design­management.­­
Unemployed­ mid-level­ professionalsmay­seek­work­in­the­more­recession-proofsectors­like­road­infrastructure,­power,­andengineering­services.­Managers­in­construction­and­civil­engineering­find­themselves­in­fields­that­are­morestable­but­their­future­could­change­as­well.­
How much lower a salary are you prepared to settle for? /
На сколько процентов вы готовы снизить свои зарплатные ожидания
13%
6%
35%
from 10 – 20% / на 10–20% ниже
from 20 – 30% / на 20–30% ниже
мore than 30% /более 30%
less than 10% / менее 10%
However,­there­have­been­some­positive­signslately.­After­a­period­of­inactivity­in­the­4thquarter­of­2008,­companies­have­started­torecruit­employees­once­again.­And­the­reasonsfor­this­are­mostly­the­replacement­of­staff,re-opening­of­previously­terminated­positionsand­maternity­leave.­It­should­be­noted­that­the­new­market­conditions­offer­both­opportunities­and­risks­–­forindividual­players­and­for­market­specialists.­The­ability­to­quickly­adapt­to­the­new­rules­ofthe­game,­to­develop­a­strategy­and­begin­to­actupon­it­will­show­who­will­and­will­not­fail.­The­current­situation­has­lead­to­virtually­allcompanies­placing­increased­demands­on­theirstaff­members­and­at­all­levels.­Especially­valuable­in­the­modern­world­are­those­individualswho­not­only­have­leadership­skills,­energy­andmobility,­but­those­who­can­adapt­to­new­situations.­Some­highly­skilled­professionals­stillremain­in­demand­today.­They­are­the­ones­withexperience­in­implementing­important­projects,who­speak­foreign­languages,­are­able­to­work­inrapidly­changing­market­conditions,­can­handlestress,­make­quick­decisions­on­their­own,­etc.­Despite­the­overall­negative­trends­in­thecurrent­
economic­ situation,­ some­ may­ findthemselves­in­more­demand­than­in­the­precrisis­period­–­especially­those­with­experiencein­crisis­management­and­successful­companyrestructuring.­There­is­also­demand­for­professionals­who­can­attract­investors­and­partners,negotiate­transactions­and­arrange­mergers­andacquisitions.­Audit­and­appraisal­professionalsare­in­great­demand­as­are­skilled­brokers­who,despite­the­crisis,­can­attract­tenants­or­buyers.2009­will­see­a­migration­of­specialists­inthe­CRE­sector.­Many­specialists­from­the­central­cities­who­are­interested­in­continuing­theirprofessional­and­career­development­within­the­CRE­sector­are­now­more­open­to­offers­fromother­cities­in­the­regions.­There­will­be­a­natural­displacement­of­foreign­professionals­andskilled­workers­(from­China,­Turkey,­CIS­countries)­by­specialists­from­the­Russian­regions.­The­current­situation­in­the­CRE­market­willsee­new­employers­emerge­in­2009­and­previously­less-known­players­will­increase­theirpresence.­Many­professionals­are­re-evaluatingtheir­opinions­of­the­major­companies,­lookingat­how­these­are­treating­their­personnel­in­atime­of­crisis­–­and­this­is­what­will­determinethe­future­attractiveness­of­these­companiesfor­job­seekers.­­
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