Kazakhstan Chamber of Commerce in the USA


Kazakhstan: The war for talent has just begun

Posted on March 30, 2010 by KazCham

Natalia Kurkchi, Partner – Antal Russia, CIS Development Director

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The unstable economic situation in the world has forced many international companies to search for new markets. The developing countries’ markets have always represented a combination of risk and attractiveness, and Kazakhstan is no exception. Nevertheless the 2010 is already beginning to show positive tendencies on the recruitment market in Kazakhstan and other countries of Central Asia: the number of ‘start-ups has increased, the demand for qualified and experienced specialists and managers from more developed countries has increased, the interest towards Kazakhstan and Central Asia from the M&A companies has also risen. All these and many other facts prove some very serious intentions of both local and international companies to develop in this region in 2010.

The candidate market in Kazakhstan has always been very narrow, both recruiters and employers very often happen to know the same candidates who are open on the market; a lot of people hoped that the economic recession would change this situation for the better. Despite the general expectations and predictions though, it hasn’t brought many highly-qualified specialist for cheaper price on the market – simply because ‘highly quality’ is never ‘cheap’.

Of course, the inflow of candidates on the market has increased significantly over the last 1,5 years: there are now 3-4 times more responses to vacancies than before. Unfortunately we can hardly speak about an increased quality of the candidates’ market: only 1-2 candidates out of 10 get to interview stage. In turn, 80% of mid-to-senior-level managers – who are still working and are still valued by their employers – are simply not considering any other job opportunities and are not open on the market. All this statistics make the opinion regarding ‘employers’ market’ quite questionable.

The employers compensate for the lack of qualified personnel by either head-hunting candidates from the competitors on the local market or attracting candidates from outside of Kazakhstan. There is obviously another way which includes developing your own staff. This is a less expensive way, but it tends to be too long and quite risky: these specialists can be as well head-hunted by the competitors.

Companies operating on the Kazakhstan market continue to open new vacancies. Over 60% of Antal’s clients have quite optimistic views regarding market development in Kazakhstan and Central Asia, and 40% of them are already actively hiring new people. The firing process was in many cases spontaneous and quite drastic during the worst times of the recent downturn. This has led to the situation where a lot of companies found themselves lacking some crucial people within their organisations. Now when the market starts showing signs of growth again, it’s becoming clear that a company simply cannot develop without a highly-qualified team in place.

During 2009 many companies struggled to maintain market share, companies with enough working capital have taken this new competitive advantage to build their businesses at the expense or poorly run ones, filling the gaps. Likewise well run companies now need to look at the availability of the good talent, as the global and domestic economies become stronger we’ll soon see firms competing for a small pool of the best candidates. Now is a good time to review your organization chart.

Main Tendencies on the Kazakhstan Recruitment Market

  • The recent global recession has forced employers to take a different view of the quality of the employees that they hire, as well as prioritising in terms of which of the structures within the organisation need to be reinforced. A good example is the Controlling function – whether it’s Finance, Internal Control, Risk Management or any other departments controlling the company’s activities and setting up limits to prevent the company from too risky or even threatening situations. Sales positions have probably received the greatest attention and development in the last several months – as was said before, no development is possible without professional Sales and Business Development people. The HR function has also developed considerably: it became clear that a proper HR Manager should not be performing only recruitment and admin functions, but should play a very important role in implementing the correct motivation and career plans for staff, thus increasing their loyalty and effectiveness. The role of IT Managers has also risen from a simple knowledge of IT programs to the implementation of the complex IT solutions for the company, data protection, secure storage of information, etc.
  • Replacements of existing employees is another noticeable tendency on the market at present. This current crisis has become a serious reason for companies to replace ‘quantity’ with ‘quality’, even though this sounds rather harsh. Such occurrences were frequent in 2009, and around 30% of Antal’s clients in Kazakhstan are still planning to replace some members of their existing teams with more professional and experienced ones in 2010 who can develop the company faster and more efficiently.
  • The present situation on the market has resulted in serious corrections in salaries from both employers’ and candidates’ perspectives. In spite of the general perception, salaries on the market have not fallen as dramatically as they were expected to. The main change has been not in the salaries themselves, but rather in the candidates’ expectations when moving to another job. In the pre-crisis times candidates would normally expect a pay rise of 50% – sometimes even 100% and more – these expectations have now fallen down to around a 15% – 40% increase on average during tougher times. Of course if talking about people who have lost their jobs, then the situation is considerably different: these candidates would usually be much more flexible in terms of their salary requirements. However, those candidates who are employed and are not actively looking for a job would have no reason to move to another job unless the salary and package are much more attractive.
  • The employment process has changed too: collecting recommendations for selected candidates is now an integral part of the recruitment process while in the past less attention was paid to speaking to referees; candidate motivation is now checked very thoroughly; professional qualifications and personal qualities are now being seriously tested by many companies. All of this is done to make sure the person fits into the organisation well and stays with the company for a long time. In turn, candidates are also paying much more attention to the company’s stability, its strategic plans, their potential career growth within the oraganisation for the next 3 – 5 years whereas before they would have given such matters less thought.
  • Owners of small businesses are re-entering the recruitment market as candidates again. Amongst these were businesses that were founded in 2008 and 2009 by managers who have lost their jobs and whose employers went bankrupt. Naturally some of these business owners have set up their companies deliberately, they continue to develop them and are willing to stay with them for years, but the main task of about 60% – 70% of these companies was to earn some money temporarily while there were not enough jobs on the market. Now as the amount of interesting vacancies is growing, these businessmen are ready to change their ‘private practice’ and become employed again by larger organisations.
  • The interest in non-CIS candidates (mainly from European and North American countries) has grown significantly. The developed markets are ‘overheated’, and experienced people from these countries are looking for new opportunities in the developing markets. Kazakhstan and Central Asia are looked at as very perspective markets for many industries. At the same time, there are not enough qualified and experienced candidates, especially within new developing industries. This gives specialists from the developed market some privilege in terms of experience, as well as a great opportunity to develop their career, although lack of language skills, coupled with potential difficulties in adapting to local culture can present a logistical issue.
  • Oil & Gas, as well as other mining industries have been traditionally very strong in Kazakhstan and Central Asia. The economy in this region is growing wider by developing such industries as FMCG, Retail, Pharmaceutical and others – which is a very positive sign for the economy.
  • Private Equity funds have to be mentioned separately. These companies are now actively growing and hiring top-class experienced specialists from all over the world to bring the best practices into the local market. As many of the Private Equity industry representatives have mentioned, 2010 will give a lot of great opportunities for the M&A activities in Kazakhstan and Central Asia.

Source: http://news.antalrussia.com/2010/02/02/kazakhstan-the-war-for-talent-has-just-begun/?dm_t=0,0,0,0,0

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