Decisions All Growing Recruitment Agencies Need to Make

The recruitment industry is experiencing a lot of change. New economic, technological and societal trends are forcing agencies to make more – and better – decisions: decisions that can affect their immediate revenues and their long-term futures.

The challenges that the industry faces are varied, and all of them require an appropriate response. At Bullhorn Live – a recruitment conference in Europe – we put a few of these questions to an audience of 1,000 recruiters.

Will you treat the gig economy as a ‘friend’ or a ‘foe’? Contract workers and contract work are both in high demand. On one hand, the flexibility appeals to young, high-earning professionals in industries such as IT, cybersecurity, and graphic design, and the prospects for employability appeal to part-time workers or those looking to supplement their main income. On the other hand, the lack of commitment appeals to employers who don’t want – or have the available resources – to hire full-time employees for short-term work.

Accordingly, it’s unsurprising that 78% of recruiters surveyed consider the gig economy a friend to recruitment. Those who regard it as a foe do not do so baselessly: the suspicion in some quarters is that platforms such as Upwork might take over easier-to-fill contract roles and, in the process, make recruiters redundant.

There are also concerns that the gig economy has added unnecessary complexity and administration to recruitment – which is already contending with an environment where employment laws are changing, the traditional culture of work is being upended, and skills shortages remain as persistent as ever.

Key to overcoming these challenges is the ability to automate the recruitment process as best possible. This includes everything from basic employment paperwork (filling out the same forms for multiple roles is not what a recruiter should be doing), to a holistic overview of contingent candidates, so recruiters know exactly who is available and when, enabling them to better resource ongoing vacancies.

But the gig economy also provides clear opportunities. IKEA’s recent purchase of TaskRabbit exemplifies this: If retail giants are willing to purchase these gig economy platforms, it suggests a degree of viability and potential. Recruitment companies should look to do similar – not by buying platforms, necessarily, but treating them as strategic partners that can fill gaps in their talent strategy and help address their skills shortages.

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Will you promote staff or replace them with technology? Recruiters are pretty tech savvy. They already use it every day to enhance almost all of their main activities, so those who consider it a real threat are a minority – albeit, a vocal one. Seventy-six percent of recruiters believe that staff will be promoted even as various forms of software, automation, and artificial intelligence all take deeper root within their profession.

Technology is at its best when it augments the professional, and thankfully much recruitment technology is focused on exactly this. Chatbots, for example, have the potential to respond to candidates’ questions without any particular need for the recruiter to intervene at all. Routine, time-consuming tasks which are all too familiar to the recruiter, such as calendar planning, meeting arrangements, and data entry, can now be easily automated.

It’s understandable that the other 24% of recruiters are worried about technology, but they shouldn’t be. A people-driven profession can be bolstered by technology – but technology can’t replace the human touch. Empathy, authenticity, and trust remain paramount, and machines can’t provide them.Instead, the recruiter of the future will spend more time connecting with candidates and clients, and less time on administrative tasks. And the industry will be better off for it.

Will you build growth through M&A or grow organically? This is a particularly tough decision for recruitment leaders. Both paths have obvious benefits and pitfalls. While 59% are actively contemplating mergers and acquisitions, 41% are preferring to pursue organic growth.

Private equity is taking the recruitment industry by storm: the number of mergers or acquisitions completed in 2017 is roughly double that of the previous year. By acquiring or merging with another company, the future of a recruitment firm can change in an instant – and most likely for the better. It’s an important way of realizing long-term growth plans in a shorter space of time. It may force compromises with vision and rifts with the consumer base, but it can be done very successfully, and when it is, the results can be highly profitable.

If companies can ensure the customer is put first, that organizational cultures are aligned, and that time and consideration are put into ensuring a smooth transition, there’s no reason that a merger or acquisition can’t be beneficial.

Regardless of how recruiters choose to tackle the challenges ahead, they must be sure to tackle them.

MORE: How I learned to love automation

Peter Linas

Peter Linas
Peter Linas is international managing director at Bullhorn.

Peter Linas

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