January 20, 2023 – In many ways, 2022 was a year of extremes. War dramatically escalated in Europe with Russia’s invasion of Ukraine in February. Inflation is still rampant in many geographies, and is showing few signs of abating, despite central banks trying to rein in escalating consumer prices and living costs. At the same time, the unemployment rate for OECD countries is just 4.9 percent, which is the lowest since records began, and a far cry from the 8.8 percent peak at the start of the COVID-induced unemployment crisis. While low jobless numbers have gone some way to abating the impacts of inflation across many aspects of the global economy, this also means it is much more challenging for organizations to attract and employ top talent, says NGS Global in a new report. “This is particularly the case at the executive level, where today’s leaders are looking for much more than just a pay packet as part of their compensation,” the study said. “Within this context, opportunities continue to be available to companies who are creative and compelling in their employment pitches to leaders.”
“We recently asked our broader network what they thought would happen in 2023 with regards to the executive hiring market,” said the executive search firm. “The results were very evenly split, with 33 percent saying it is only going to get worse and even more competitive, 30 percent saying that it will get better and calm down, and 37 percent saying that it will stay about the same.”
In the study, the firm’s global group of 38 senior and managing partners across Europe, Asia-Pacific, the Americas, Africa, and the Middle East laid out their 2023 predictions for leadership, the broader economy, and executive search in 2023:
Talent Demand to Stay Strong
Despite economic headwinds and the threat of a prolonged global recession, hiring for executive talent remains very strong. “Our partners group have detected a small demand slowdown in the business-to-consumer market for senior leaders, but the business-to-business market is as strong as ever,” said the report. “The majority see this as continuing throughout next year.”
“Clients are and will continue to be offensive for the future in 2023,” said Karla Dorsch, managing partner at NGS Global’s operations in the Middle East. “Businesses need to stay competitive by being ready to combat whatever is ahead of them, and stay at the top of their game. With so many aspects of the macroeconomy currently uncertain, having the right executive leadership in place is arguably the most critical component of positioning an organization for success in the future.”
Expectations on Executives to Increase
At the same time, there is an entire generation of leaders that have not operated with the types of inflation that we are currently experiencing. Throughout 2023, these challenging operating and commercial conditions, particularly with regard to a fast-increasing cost base and ongoing supply chain issues, mean that both the expectations and performance demands on senior leadership will increase, said NGS Global.
“The need for executives who can do more with less – in other words, deliver better results per unit of cost – will be paramount next year,” said Soumitra Agarwal, managing partner of the firm’s India team.
Other partners added that if recessions do hit, the emphasis on executive performance will also shift from sales-led growth to a wider range of priorities, including change management, prudent financial management, best use of resources, and inspirational leadership.
Rapid Growth Industries and Roles
2023 will see NGS Global clients who are determined to continue growth during this uncertain period by taking market share off their competitors, and others where market forces are providing growth opportunities (such as 5G, cybersecurity, the internet of things and fin-tech), said the report.
What Senior Leaders Need to Ask Themselves in 2023
There’s no better time than the new year for employers everywhere to think about how best to meet the challenges of the months ahead. In a new report, Grace Blue Partnership offers insights into finding, keeping, and developing talent in these days of economic uncertainty, a stubborn virus, and change
“The past two years has seen a significant uplift in the demand for talent in the cleantech, sustainability, recycling, and solar sectors, with NGS Global delivering executive search projects for a wide variety of companies in this area, including placing a range of executive roles at a leading electric vehicle automotive company,” said the firm.
Cleantech is a very rapidly maturing asset class. NGS Global says that the level of private equity and venture capital investment, governmental policy support, and innovation will only increase in subsequent years, making the sector almost recession-proof. “Currently, more than one quarter of all global venture capital is going to climate tech start-ups, totaling $77 billion for the last 12 months (by comparison, 2018 saw less than half this level of investment – $36 billion),” said the firm.
“This growth will see a subsequent surge of increased demand for executive leadership and talent in the next two to three years and beyond,” said Steve Lavelle, managing partner at NGS Global’s U.K. office.
The firm also predicted that 2023 will see a significant demand for both cybersecurity companies and senior roles.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media