We spent some time over the last month or so delving into the current temperature of the audio, video, lighting and broadcast market around the world. Covid-19 has hit everyone in these sectors hard, but we wanted to know just how much it has changed things for the industry, and try to see and understand any variations across vertical or geographic markets.
Over the course of three weeks in May and early June we invited executives working in these markets around the world to complete our Market Temperature Check survey. For those of you that responded, thank you. Your insight has proven incredibly valuable and you will have already seen the full results which were shared with all who took part.
The responses revealed a number of interesting trends, much of which were probably somewhat predictable. This in itself is quite encouraging, however, as it bears out some of the logic of what is happening economically and with the pandemic itself around the globe, as well as how different market verticals from Live Events, through House of Worship, Sports, Broadcasting, Commercial Install and Retail are all being affected differently. Sentiment within businesses primarily working in Commercial Installation sectors was relatively stronger than from those working for Rental Companies or in Live Events for example. And short to medium term outlooks for business where APAC represented a major proportion of sales, were stronger than where Europe or the USA were the largest market.
Here, we’re going to focus on the impact Covid is having on staffing, training, recruitment and other investment plans.
The Impact of Covid-19 on Audio, Video, Lighting and Broadcast Markets
Overall, just under a third of respondents in our survey reported they had taken no staffing actions in their businesses as a result of the pandemic, suggesting that a fairly significant portion of the industry remained resilient during these first few months. There was a fairly even mix of staff layoffs, reduced hours and furloughing and of course, local factors and different government business and employee support schemes and laws will have played into this. Interesting to note that the business type reporting the lowest percentage of layoffs (13%) and highest percentage of no action (48%) was Distribution. Other segments reporting above 40% no action were Broadcast/Studio and the UK. The UK also showed the lowest reporting of staff layoffs as an action taken (7% compared to 23% overall), perhaps due to the high take up (57%) of the UK’s Job Retention Scheme to furlough staff full-time with government support.
The percentage of staff affected in each case followed a fairly similar pattern across the various segmentations. However, when Commercial Install was the primary vertical market, over 40% reported less than 10% staff having been affected. Conversely the UK overall and the Rental market both reported 57% and 75% respectively where all staff were affected by one of these actions.
Arguably, much of the above was to be expected given the situation that all businesses have been facing since February, and it is reassuring to see some resilience and talk of plans for investment amongst those surveyed.
Training and Staff Development Programmes
We were curious to understand more about internal staff training and development tools and programmes, and how Covid and its economic knock on effects have impacted on the interest or commitment to these type of activities within businesses in our sector.
A quarter of respondents reported that programmes and tools were already in use within their business for individual staff or team development. These range from specific outsourced training and coaching, video training and in-house development software or performance mentoring. This trend was reflected fairly widely across all segmentations although conspicuously the Live Events, Rental and House of Worship sectors were least invested in these programmes, whilst businesses primarily involved Commercial Install showed the highest proportion of business operating staff training and development programmes with over 40% of respondents.
Two thirds of businesses that reported operating programmes in this area, are doing so with staff across the whole of the business, but where training or support is being offered selectively within the business the two areas where this is being deployed most actively are marketing and engineering.
Interestingly, when we asked about sentiment and intention to introduce this type of internal training and staff development support, one third of respondents indicated their intention to do so, a marked increase from the numbers that were already doing so. And notably, the departmental areas within the businesses surveyed where this seemed to be of most interest were sales and engineering. Perhaps not surprising again with these two functions being seen as key to immediate business survival and longer-term resilience and competitiveness.
Future hiring plans: Permanent and Temporary
We asked respondents a variety of questions to understand their current recruitment plans or intentions, whether permanent or temporary. Predictably, just over two thirds of respondents when asked about hiring both permanent or contract/temporary staff said that they had no immediate hiring plans within their teams or businesses. However, there were still some strong indications for plans to recruit in engineering and sales with around one fifth of respondents revealing these intentions. And in certain cases, including within manufacturers and businesses where the US or APAC was the primary business territory, one third of respondents reported plans to continue hiring in engineering.
Curiously, across marketing – where there was a lot of immediate spend and activity evident early on as Covid took hold around the world – intentions to hire and invest further in this area were reported by less than 10% of respondents. So it appears that any spikes of spend or recruitment in these areas may have been short-lived, with businesses preferring to direct limited investment into sales, engineering and support.
Again, perhaps not surprising, 100% of respondents where Rental was the primary business type, indicated they had no immediate plans to hire permanent staff. However, looking at intentions to recruit contract or temporary staff, 50% of those same businesses indicated immediate plans to hire in support and operations, perhaps underlining the needs to maintain an agile capability in a continually unpredictable business landscape.
We were surprised to see that there was no real difference in the numbers between intentions to hire full time as opposed to contract or temporary. It may be too early to see this affect coming through as we still anticipate that the use of temporary or contract staff in many key business areas may become a key part of how businesses navigate through the next year or so. However, there was quite a wide range of attitudes reported around plans or intentions to hire contract or temporary staff behind the overall numbers, and interestingly this seems to be driven as much by primary geographic preference than vertical market. Perhaps this indicates already established patterns in those same markets. For example, for businesses where the USA, Europe or APAC is the primary geo market, around 10% of respondents indicated they are considering hiring contract or temporary staff in engineering, sales or marketing. Whereas for businesses where the UK is the primary market, no respondents stated they were considering hiring contract or temporary staff in those areas and 86% of these people indicated no plans to hire contract or temporary staff at all. This may reflect the nature of the current government backed Job Retention Scheme in the UK, as well as the fact that in this market most front-line business or engineering employment tends to be full time.
Clearly there continues to be plenty of thinking around boardroom tables about areas for investment, and this is likely to be focused on both strengthening and consolidating current offerings, as well as potentially pivoting to develop or take advantage of new market opportunities.
Almost half of those surveyed reported plans to invest in internal education, training and team building. And over half reported plans to invest in customer support or training as well as engineering.
One third of those surveyed responded saying that there are plans to invest in in-house technology, systems and operations, indicating that this is an area where many businesses see opportunities for efficiency improvement driven by the pressures to remain agile and competitive in the months and years ahead. About the same number also reported intentions to invest in partnerships and collaboration, a sentiment that is perhaps already evident more widely in how businesses are communicating and helping each other during very difficult times.
Another area of interest reported by a number of respondents was exploring opportunities for mergers or acquisitions, whether buying or selling. Confirming as is to be expected in such volatile market conditions that M&A will remain high on the list of corporate considerations for many.
Talent is Key
The old business adage that Cash is King, has probably never been more true than it is now. But in the same way, businesses are also learning more than ever that in challenging times, Talent is Key. These results certainly paint an interesting picture from around the global audio, video, lighting and broadcast sector, but no matter what the situation or market is, it’s the people that will work to drive change and innovation as businesses navigate through the current crisis and beyond.
Existing teams and individuals need to be listened to, supported and motivated more than ever so that they can be at the heart of the solution. And there will be opportunities to bring in new talent, that may be critically needed to support new or existing business initiatives. Talent which only a few months ago may not have been available, but now, due to inevitable cut-backs, downturns or layoffs, will be. At a time when cash is king and managing finances remains a critical consideration for survival, the costs associated with supporting existing staff and teams and potentially bringing on board valuable new talent that will be part of the turn-around should be seen alongside other strategic investments in the future of the business. And it is the people who will remain as probably the most import strategic investment that any business can make in its future success.
Interfacio works with client companies and with individual professionals around the world, helping build teams and develop careers. Our consultant team have all worked for many years themselves in the business in various roles and sectors before we worked as recruiters. If you would like to discuss any aspect of how you are planning to develop or organise your business, or if you are looking for a particular talent profile to complete one or more of your existing teams, why not get in touch to arrange a call with us.