As 2015 comes to a close, I’d like to take a look at the events that shaped the staffing industry in 2015 — and share my job market forecast for 2016.
Hottest in 2015
Healthcare and IT are the two industries with the most significant growth in 2015. There are a number of factors contributing to this, including:
- The US population is aging, with age 65 and older becoming the fastest-growing demographic in America today. With people living longer, home healthcare, senior centers and other services catering to the aging market are booming.
- Medical advances have accelerated in an unmatched pace in a number of areas, including longer term treatment for chronic diseases; less invasive surgeries that contribute to better results and quality of life; mobile stroke units; and other breakthrough medical treatments.
- The Affordable Care Act has given rise to a host of new companies requiring a crop of IT professionals.
- Technology companies in general represent one of the fastest-growing business sectors, creating housing shortages and high rents in both Silicon Valley and the Northeast corridor.
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Looking Ahead
Here’s where I expect to see growth in 2016.
Managed Service Providers (MSP) and Vendor Management Systems (VMS)
Though companies continue to consolidate their labor costs and supplier pool, at the same time they are keenly interested in acquiring the best candidates — thus precipitating a greater reliance on outsourcing to MSP and VMS. This has been an ongoing trend that will continue in 2016.
Growth among smaller, midsize firms
As in any rapidly changing, disruptive industry, smaller and midsize staffing firms are growing at an accelerated pace. They are more nimble and are able to react to market changes – as well as employ new technologies – with greater ease and efficiency. Transparency is a key factor that will continue to drive the technology employed in the staffing market.
The labor market has considerably tightened over 2015, and will likely continue to do so throughout 2016. The headline unemployment rate at the end of the third quarter of 2015 had reduced to 5.1 percent from 10.0 percent during the Great Recession. Consequently, there is greater competition for the most talented individuals which makes it critical that employers leverage cutting edge technology in order to find the best candidates before their competitors do.
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The need for best performing workers is most in small and medium businesses. With the healthcare industry growing rapidly, it is quite obvious that both MSP and VMS Healthcare firms will expand quickly.