Staffing Industry Analysts recently gave a staffing industry report, including an overview of its 2014 survey of North American contingent labor buyers—companies that utilize contingent workers. Their report was full of compelling staffing industry trends that can offer professional recruiting firms insight as they consider strategies for growth. If you missed the report, don’t worry—I’ll give you highlights and continue the conversation about where the staffing industry is heading.
US Economy News is Mixed But Strong
Jon Osborne, VP of Strategic Research, started the presentation with an overview of key US economic indicators. He said the few areas of bad news could be reflective of a mere first quarter “blip.” That negative news was countered by positive indicators, including low unemployment.
- US GDP was down by 1 %in the first quarter.
- Consumer sentiment remains low.
- 1/3 of adults ages 18 to 34 live with their parents.
- Jobless claims are at a 7-year low.
- Manager’s indexes in both manufacturing and non-manufacturing indexes are up.
- Certain economic areas have strong growth, such as natural resources, which includes mining, and professional services, which includes outsourcing and computer services.
- Temporary employment has been growing more slowly since February, but is still up 8.5 % over last year.
Contingent Labor is Growing Overall
Osborne says that despite some mixed economic news, the economy is doing OK, and that “every area of staffing is doing very well.” The survey of contingent labor buyers covered current staffing industry trends including:
- The contingent share of the workforce continues its long-term growth, with a median of 15 % in 2013 and 2014.
- There is a “hiring boom” in direct hire and executive search, with an 8 % increase year over year for both.
- There is an expected increase of 9 % over the next 10 years for online staffing services.
- 81 % of respondents to SIA’s buyer survey said their total workforce is going to grow over the next two years.
“I would say a general theme of the webinar was that the staffing industry is in good shape right now,” says Jon Osborne, vice president of strategic research at Staffing Industry Analysts. “BLS and PulseSurvey data indicate that the industry – across most sub-sectors, temporary, place & and search and PEO – is seeing solid growth and, on the demand side, contingent buyers continue to be in expansion mode.”
Staffing companies should reach out to prospective clients now to build relationships and be of value. As those prospective clients become buyers, they’ll already have you in mind as the best source of help to find the talent that they seek.
Contingent Workforce Seen as Valuable
Many companies are strategic in their utilization of contingent workers so they are better able to adapt to the economy and as their business needs ebb and flow. Past concerns about worker loyalty, learning curve, and productivity have lessened over time.
- The largest influence upon contingent labor is variable and unpredictable workloads.
- Larger companies are more accepting of utilizing contingent labor than are smaller companies.
- Buyers (companies that utilize contingent workers) predict they will be hiring more contingent workers who are highly skilled and more statement of work (SOW), project-based workers.
- On average, buyers said they will be more likely in the coming years to hire contingent workers than traditional, full-time employees.
Staffing companies may decide to focus in on larger companies, which are more likely to use contingent labor. Or perhaps you decide to actively seek out more candidates who specialize in SOW projects – that way you have top talent to offer when your clients need talent.
Staffing Firms Can Prove Value in Underserved Areas
Although the staffing industry remains strong, there are areas that tend to be underserved. Savvy staffing agencies might consider working with clients in these ways to grow their companies.
- The fastest growing area for staffing services is in education and library, with a 12 %growth forecast. “With respect to the education market, selling to government is always challenging but some companies are nonetheless doing it successfully,” says Osborne.
- Human resources outsourcing is growing, doubling over the past 5 years.
- Companies that use staffing firms are concerned about facing a skill shortage. Staffing firms can prove their value by being a valuable source of candidates who have the skills that clients in their niches typically seek.
- On average, the larger the company, the more positive their attitude about contingent labor.
As they say, knowledge is power. Leverage the latest staffing industry trends as you develop growth strategies for your recruiting firm. With jobless rates down and the economy steadying, recruiting firms have a great opportunity to continue to prove their value to clients and position themselves to grow over time.
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