State of the Bay Area Finance & Accounting Job Market Update: June 2020

The roller coaster continues. Even as restrictions gradually loosen and people start to venture back to the office, life looks very different than it did in March. However, the Bay Area job market is ramping up again. 

April and May were slow hiring months, with interest in hiring starting to pick up near the end of May. In June, we are on course to increase our newly initiated searches and projects by 50%. Business is picking up as companies adjust to remote work and build back confidence in their businesses. Based on our conversations and observations at BVOH Search & Consulting, here’s what companies and candidates can expect in the San Francisco job market on the path ahead.

Are Companies Hiring? 

Virtual technology, social media, and life science companies continue to dominate the hiring landscape. The stock market has recovered back to pre-COVID levels, and investments are moving around again. 

While a small group of companies is thriving in quarantine (Zoom’s market cap recently exceeded the entire US airline industry), other sectors such as life sciences continue to hire simply because their purpose hasn’t changed. Pharmaceutical, medical device, healthcare, and biotech companies continue to be necessary regardless of COVID. We still need cures for cancer and medical equipment for essential surgeries.

Net neutral companies also continue to hire. Although their employment needs have not increased because of COVID-19, asset management companies such as venture capital, private equity, and investment firms have the same demand they did before. Portfolios are up or down, companies are shrinking or growing, and investments still need to be managed. While they’re a relatively small sector, net neutral companies still create a noteworthy hiring demand.

Who’s Not Hiring? 

News coverage typically features companies on far ends of the spectrum. The companies who are mass hiring or laying off make a great story, but it’s not an accurate picture of most companies.

Only about 20% of companies on either side are making these massive cuts or gains, but the remaining 60% of employers are silent. Most companies are in a wait-and-see mode. The outlook isn’t overly positive or negative, but uncertainty is causing them to remain cautious. They’ve put their searches and projects on hold – contingent on Q3 and Q4 results – before they move ahead. <

“Hiring procedures are different, the candidate pool has changed with the normalization of remote work, and CFOs are under more pressure than ever before.”

Larger companies seem to be more resilient than smaller, as many VCs have directed their portfolio companies to batten down the hatches and weather the storm. In our conversations with CFOs of companies of 50-200 people, we’ve found the vast majority have hiring freezes. When will it open up? When they have more visibility. All eyes on are Q4, but no one knows exactly when business will return to a more normal state. 

How Companies Hire During Quarantine

Even though many companies are in a freeze, hiring still happens during a crisis due to unplanned vacancies or growth. But the companies who are hiring right now face a new set of challenges. Hiring procedures are different, the candidate pool has changed with the normalization of remote work, and CFOs are under more pressure than ever before.

Larger companies who are hiring will likely use their internal recruiters (if they’re not furloughed). But the finance and accounting Bay Area job market is still tight. If companies can’t fill the role on their own, they’ll then move to external recruiting firms. At the executive level, most companies continue to hire a search firm to find a CFO.

The role of the CFO is more difficult than ever these days. They’ve been through the wringer trying to forecast their businesses. Forecasting the top line is incredibly difficult and a guess at best as historical trends do not apply. One leader I spoke to was on his eighth forecast in eight weeks. Finance leaders are “busier than ever before,” trying to lead their organizations during this time and creatively find ways to accomplish more with less.

For the 60%+ of companies in a holding pattern, many still have more work than people to cover it. One way companies are addressing this gap is by hiring consultants. Even though they’re dealing with budget cuts and hiring freezes, consulting dollars are often still available which allows them to hire temporarily to ease the workload. While it’s challenging to fill these roles remotely, they’re making it happen.

Many candidates have been interviewed, hired, and on-boarded 100% remotely — without ever meeting anyone face-to-face. As companies learn to adapt, some have opened up a national talent pool. While many companies are not yet ready to hire 100% remote employees for permanent roles, at least during shelter-in-place, project-based hiring becomes much easier when you open up your talent pool to the rest of the country.

The Real Unemployment Situation in Finance & Accounting

While the San Francisco unemployment rate is up, top finance and accounting candidates are still in demand. Companies assume they can easily fill their finance and accounting positions because unemployment is so high. However, most finance and accounting teams were lean to start with — and have remained intact. 

For instance, when Airbnb and Lyft made massive cuts, they put a link on their site including every person who was laid off and their respective title to help former employees in their job search. In analyzing those laid off, only 0.5% were in the corporate accounting or finance sector. Ironically, it was almost the same percentage for each of these companies. Yes, these businesses laid off a huge amount of people, but the vast majority of finance and accounting professionals kept their jobs. Generalized unemployment rates simply don’t translate to the Bay Area finance and accounting community. 

“The San Francisco unemployment rate is not reflective of the finance and accounting market — which is magnified by the fact that passive candidates don’t want to make a move.“

However, because unemployment is high, some hiring managers assume they can be even more selective, finding every quality they want in a candidate, maybe even at a lower price. That’s simply not the case. The San Francisco unemployment rate is not reflective of the finance and accounting market — which is magnified by the fact that passive candidates don’t want to make a move. 

Are Candidates Willing to Make a Move? 

Candidates are extremely hesitant to leave a decent job unless they are really unhappy or very concerned about their company’s future viability. They are afraid they’ll be LIFO (last in, first out).

Plus, there are added complications to candidates entertaining a transition. Candidates who are working parents now lack activities for their kids this summer and possibly this fall if schools do not open up. They typically want to stay put to avoid adding the stress of a job transition.  

Bottom line, there’s less available talent when the perception is there should be more. This makes for a very tight candidate pool. 

However, with the right connections, it is possible to find a good passive candidate. Recruiting firms make this process easier as they invest their time in helping candidates become comfortable with the idea that a new job could be a better opportunity, all things considered.

If you hire on your own, expect to invest time in helping candidates become comfortable with their job security at your company. Be prepared for more scrutiny. They are doing their due diligence by asking more questions than before. There are great candidates out there, but they’re taking these job moves more seriously than they would in other circumstances. 

Expect to put more effort into the search. Not less.

Similarly, you don’t have more time to hire, you have less. Jobs are filled fast. This isn’t an 8-week process anymore. We’ve simplified the interview process in many ways with remote hiring. Schedules are easier to coordinate and, if both parties are motivated, this can happen quickly! No longer do we have to take time off work and travel for multiple rounds of interviews. The interview process can go from phone screen to hire very quickly with minimal delays.

While the COVID-19 crisis is far from over, the Bay Area job market is showing signs of life. The need for finance and accounting candidates continues. In their resiliency, tech companies have even found ways to benefit from the advantages of remote work and hiring. While we don’t know exactly what lies ahead, the future isn’t bleak. The San Francisco marketplace is making strides and adapting with each change of course.