As a specialist recruitment company dedicated to placing Senior Finance and Transformation interims into critical roles across the UK, we understand the importance of staying ahead of market trends and regulatory changes.

The 2024 IIM Interim Management Survey provides valuable insights into the current landscape, offering a comprehensive view of the economic impacts, IR35 implications, salary trends, and emerging opportunities within the interim market.

Here’s a summary of the key findings from the IIM Survey, along with our recommendations for senior Interims…

Economic Impacts on the Interim Market

The economic landscape for interims has been challenging yet dynamic. The IIM survey results indicate a significant reduction in the number of assignments, with those billing fewer days increasing substantially from 18% to 32%​. This shift suggests a slowdown in demand, which can be attributed to the broader economic context marked by cautious corporate spending and ongoing market uncertainties.

Inflation rates have seen a reduction, with CPI falling and the Bank of England striving to maintain its 2% target​. However, the economic policies of the newly elected Labour government remain uncertain, particularly regarding potential adjustments to off-payroll regulations. As interims, understanding these macroeconomic factors is crucial for strategic planning and positioning in the market.

From our perspective, the economic impacts have been multifaceted. While Q1 showed a buoyant market with significant year-on-year growth driven by falling inflation and high business confidence, the momentum slowed in Q2. Despite positive lead indicators, the senior interim labour market did not fully capitalise on these trends. The snap election further dampened market activity. However, in recent weeks, we have observed renewed confidence and a promising uptick in assignment numbers, which we expect to continue throughout the summer.

IR35: Continuing Complexity

IR35 remains a critical concern for interims, with its implications affecting both assignment opportunities and remuneration. The survey highlights that interims working outside IR35 continue to command higher day rates compared to those inside IR35.

Specifically, day rates for interims outside IR35 averaged £907, whereas those inside IR35 averaged £809​. This differential underscores the ongoing need for interims to navigate the complexities of IR35 compliance carefully.

The most concerning finding, however, is that 60% of interims did not receive a Status Determination Statement (SDS). This points to a significant lack of understanding among clients about IR35 regulations and how to navigate them. Additionally, poor advice from some intermediaries exacerbates the situation.

We are observing that inside IR35 assignments are now demanding higher rates due to the increased operational costs associated with these assignments, with interims bearing the burden of both employee and employer National Insurance contributions.

We await to hear the new government’s view on IR35, as so far, they have remained fairly passive on the subject of ‘Off Payroll’ Regulations or similar, so it is difficult to know what if any changes may occur in this area.

Salary Trends & Gender Disparities

On the remuneration front, there has been a positive trend in average day rates, which increased to £873, up by 8% from the previous year​. This recovery is a welcome development after the minor dip experienced in 2023. Notably, the gender pay gap has narrowed, with males earning an average of £902 per day and females £783 per day, reflecting a 15% difference compared to the 21% gap in 2023.

The private sector continues to offer the highest remuneration, with day rates averaging £959 compared to £706 in the public sector. This highlights the lucrative opportunities available for interims in private enterprises, particularly in industries like manufacturing, engineering, and technology, which have seen notable growth​.

So far this year we have observed a significant increase in interim pay, especially within our Accountancy and Finance practice. This aligns with the survey's findings across the Tech, Manufacturing, and Engineering sectors. We also noted a surge in rates within Private Equity at the beginning of the year before they stabilised. Additionally, we produced our annual Accountancy & Finance salary guide which includes day rates for specific Interim roles, you can download this here.

Opportunities & Recommendations

Despite the challenges, there are promising opportunities for interims, particularly those with expertise in the high-demand areas.

For interim CFOs and their teams, especially those working with Private Equity firms and portfolio companies, the landscape remains ripe with potential. The financial rigor and transformation skills these roles require are in high demand, aligning well with the sectors the IIM say are experiencing growth. Here are our recommendations for Senior Interims:

1.      Stay Informed on Regulatory Changes: Keep abreast of any developments in IR35 and other regulatory changes that could impact your contractual arrangements and remuneration.

2.      Make sure you get a Status Determination Statement (SDS): When operating as an Interim, it is a legal requirement for the end client to issue an SDS. Always insist upon receiving an SDS when working on assignments, particularly if working outside IR35. You may leave yourself exposed to future tax issues with HMRC without one.

3.      Enhance Your Direct Sourcing Capabilities: Focus on building a strong personal brand and expanding your professional network to increase direct assignment opportunities. Please reach out to us to get your copy of our guide to using LinkedIn to promote your professional brand.

4.      Adapt to Economic Trends: Be prepared for fluctuations in demand and day rates by diversifying your skillset and exploring opportunities in growing sectors like technology and manufacturing.

5.      Address Gender Disparities: For female interims, it is essential to negotiate assertively and leverage the narrowing gender pay gap to achieve equitable compensation.

6.      Leverage Specialist Recruitment Support: Utilise the expertise of specialist recruitment firms, such as Stanton House, to proactively identify opportunities and effectively represent your skills. We are proud to be an Affiliate Member of the IIM and ranked this year as a Platinum Service Provider – moving from 10^th position last year to number 6 in the rankings!

7.      Maintain Regular Contact with Your Interim Provider: There is a strong correlation between staying connected with your interim provider and securing your next assignment. Keep in touch with the provider who placed you to increase your chances of finding subsequent opportunities.

In conclusion, while the interim market faces economic headwinds and regulatory complexities, there are significant opportunities for those who can navigate these challenges strategically. By staying informed, enhancing direct sourcing capabilities, and aligning with growth sectors, senior interims can continue to thrive and command competitive day rates in this dynamic landscape.