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posted by on May 22, 2009

Earlier this week, Personnel Today produced an article that has appeared to have been lost in cyberspace, when it should have in fact sent shivers down the spine of the entire recruitment industry.

 

Surveys/Reports/Investigations are often not worth the paper they’re written on, however, this one seems to have an element of common sense behind it.

 

The headline reads: “Use of Recruitment Agencies won’t resume when recession ends.”

 

Human Resources and Recruitment experts have been forced by budget caps to source new methods to recruit new talent to their business. Many recruitment based professionals are confident of an upturn, and indeed some people I’ve met with recently seem to think that things will return to levels last seen in the ‘licence to print money’ era of the late 90’s. However, this suggests that not only is that not likely to happen, we may in fact struggle to see a recovery at all.

 

So, if you are gearing up for a new career move some time soon, you may have to be a lot more creative than speaking to your local agency. After all, companies are now looking to source the best people via the most cost effective methods around.

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11 comments

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  • 2 points 6 months ago

    I seem to remember a similar viewpoint when online job boards first launched. "The end of the recruitment industry as we know it" or something to that effect. While I might agree that there are some organizations with the resources to brand their organizations for recruitment and reduce costs through staffing an internal recruitment function, most organizations just aren't big enough to incure these kind of fixed costs. Hiring, and thus recruitment, is cyclical with any organization. There will always be a need for contingent resources in the marketplace. I don't mean contingency recruiters. I mean the ability to temporarily increase recruiment horsepower when demand increases. Whether that's through the use of recruitment firms, contract recruiters, or whatever, the need will always exist to some degree.

  • 1 point 6 months ago

    Good point Brenden.  I also remember hearing similar concerns in the last recession, because when business becomes difficult it's natural to question whether the change is cyclical or secular in nature.

    What actually hapened last time is that many companies laid off too many employees in the recession.  When business rebounded, their need for employees to handle the growth was acute and the cost of having those positions go unfilled was far more than the cost of paying a recruiter's fee!

  • 2 points 6 months ago

    To further reflect on this, I think there's a hidden message within James' original post. The recruiment process and what is considered "value-add" will always need adjustment, tweaking, and re-inventing. Technological and economical forces dictate that all industries innovate or become irrellevant. The third-party recruitment business is no different. Having worked in both corporate HR departments and TPRs, I have a pretty well-rounded perspective of "the dance." I don't think we'll ever be back to the "print money" hayday of TPRs (nor do I think we should be as a lot of damage was done to the image of the recruiting profession during those times), but I still think valuable partnerships will exist between internal and external recruitment functions regardless of technology or the economy.

    Just my 2 cents.

  • 1 point 6 months ago

    Brendan, 

    You're there or there abouts with my intial thoughts. I suppose what I am saying is that 'Recruitment Agencies' in the truest 'Agency' respect will no longer survive or flourish. I am assuming that no contributor here is an agency consultant at Adecco, Manpower, or similar. 

    Recruitment professionals that have industry experience, contacts, and knowledge will always survive and as mentioned earlier, even flourish. 

    Maybe I should bring this full circle with the Recruitment Agent / Recruitment Consultant debate? 

     

     

     

  • 1 point 6 months ago

    Maureen, 

    I agree that LinkedIN is a small pool of the global potential. However, I also think that LinkedIN could be the first ladder of these type of social networks. My thoughts are along the lines that if this rolled out to different areas, industries by people who are happy to label them as a 'passive job seeker' it could begin to dent the effectiveness of normal recruitment methods. 

     

  • 1 point 6 months ago

    "Could" remains to be seen.  These social networks are only as good as the information contained within them and as it ages (think member profiles that never get updated for various reasons) so does the utility of the network.  Now...if someone figgers out how to automatically update follow info - think GPS systems that follow you and your cell phone around (with your permission of course but many will opt-in to this, IMO, not really understanding what it is they're setting themselves up for) and allocate information into the systedm based on where you spend your days (and nights) - it's a whole new frontier for social tracking, IMO and could sound one of your alarms...but then, it still wouldn't bother me too much knowing that the vast army is still not "connected" like you seem to think they are and are fast becoming.  I think we have a ten-twenty year window here - at least.

    Of course I could be wrong.

  • 1 point 6 months ago

    Brendan, 

    I'd also like to ask that perhaps the arrival of new firms that enable smaller, more budget conscious firms to create a brand and its management may well begin to step on toes? 

    I am not saying that the recruitment industry is dead (that would be very stupid), but I am saying that I think it needs to re-brand its very self. 

     

  • 1 point 6 months ago

    I remember the arrival of the 'job board' well and I seem to remember the thoughts were that it would kill off recruitment. 

    All that actually happened was it allowed recruiters to use cost effective and quicker ways of attracting candidates. I still return to the point that if organisations have maas hires to put through when the economy returns to normality are they going to use a firm that advertises their job on their behalf and then charges a cost per hire? 

    I just can not see it working. 

    I agree that some recruiters will not only survive, they will flourish, but it is mainstreet that I see will get hit. Search consultants will always have their place, but your average rec-con may well struggle in 2010 and beyond. 

     

  • 1 point 6 months ago

    I think that there will be a load of new methods that try and offer synergy with an organizations ability to recruit their own staff. I fail to see, from a very brief view how a service such as yours could possibly compete with the enormity of the effort put in by willing individuals on social networks such as Linkedin.com. 

    Companies are now harnessing their own brand and their own direct recruitment methods and third party suppliers of any kind are going to have to work a lot, lot harder to earn the big corporate bucks!

     

  • 1 point 6 months ago

    James, respectfully, LI is a drop in the very big bucket of what's available out there - a tiny drop - and the information online ages as we speak.  There will always be a need for fresh, real-time results and organizations like mine deliver just that.  Fast. 

    ******

    Our goal is to save you time and help you succeed.

  • 0 points 6 months ago

    Would that include telephone names sourcing?