A changing landscape: an overview of the US Valuations market in 2023Delve into the reasons behind the ups and downs, and the implications for both employers and talent.
Like many other sectors across the globe, the US valuations market has experienced significant shifts and challenges in 2023. After a promising start to the year, the market began to slow down in February and March, leading to massive lay-offs across the country. This blog post will delve into the reasons behind this decline, the implications for both businesses and valuations professionals, and how to future-proof in this continuously developing environment.
A busy 2022 sets the stage
In 2022, the valuations market was bustling with activity, witnessing a surge in deals and an increased demand for valuation services. We saw it within our own business. Firms responded to this high volume of work by hiring extensively, bringing in additional staff at various levels. These new hires were well compensated, reflecting the urgency of completing valuations under tight timelines.
The costly staff surplus of 2023
Unfortunately, the market slowed down in Q1 of 2023, with severe repercussions. As deal flow dwindled, firms found themselves burdened with a surplus of costly staff. The top 20 accounting firms, in particular, were heavily impacted, resulting in mass redundancies which started on the West Coast, then mid-USA, then East Coast, across all levels, from Associate to Managing Director (MD).
No safeguard for strong business books
Even those with robust client portfolios found themselves vulnerable to the market's downturn. Previously, having a strong book of business offered some protection against staff redundancies. However, in 2023, this safeguard proved ineffective, emphasizing the severity of the situation.
Recruitment shifts to critical roles
As the market recalibrates in recent months, companies are now adopting a cautious approach to recruitment. Many are currently only seeking candidates for critical roles, typically at manager level, with between five and eight years of experience. By focusing on these essential positions, businesses aim to maintain their core capabilities while weathering the storm.
MD and Partners: a proactive move
While critical role recruitment still takes centre stage, some companies are quietly making strategic hires. Recognizing the value of experienced MDs and partners with an established client base, these businesses are future-proofing themselves for when market conditions improve. These proactive hires ensure that firms can hit the ground running and gain a competitive advantage.
Silent hiring practices
Remember though that most of these strategic hires aren’t being publicly advertised or openly discussed. Instead, they’re primarily happening through connections and networking. This covert approach allows companies to secure top talent discreetly, avoiding unnecessary attention and competition.
Learning from competitors
The current landscape dictates that companies observe and learn from their competitors' actions. By monitoring what others are doing, businesses can gain valuable insights into effective strategies for future proofing themselves. Staying informed about industry trends and developments is crucial in navigating the ever-changing valuations market. At Apollo Solutions, we’re working with our clients to keep them updated on sector developments and trends.
As a candidate, it’s important to also be aware of these shifts and adapt your strategy accordingly. Why not seek out intel on which companies are hiring and what positions are available? It’ll give you a competitive edge. By collaborating with industry experts, like our consultants at Apollo Solutions, who have access to this information and more, candidates can position themselves for success, even in this challenging job market.
The US valuations market has experienced significant upheaval in 2023, marked by a slowdown, restructures/redundancies, and a cautious approach to recruitment. However, there’s a silver lining as companies proactively hire MDs, partners, and other valuations specialists who can help them to secure their future success. The more savvy employers are making the most of these quieter periods to hire strong candidates who are currently available or feeling the strain following a turbulent few months.
If you work in valuations…our advice? Watch this space. Keep an eye on the developments and learn from competitors to thrive in this ever-evolving landscape. If you want more market insights like these, why not call us for a confidential chat? At Apollo Solutions, we’re more than just recruiters and are market experts deeply embedded within valuations, working with both clients and candidates to help them navigate this exciting niche.
Alternatively, if you’re a candidate interested in furthering your career in valuations, why not, browse our jobs, upload your CV, or contact us for a chat about your specific needs. We’re here to help!