Spotlight

Building a Digital Tomorrow: A Spotlight on Digital Transformation in the Recruiting Industry

You’ve probably seen the term digital transformation floating around the staffing and recruitment industry recently as technology further solidifies itself as a key component of smooth business operations. With the impact of technology on the industry at an all-time high, leveraging the right technology in the right way has never been more important.

Are you fully embracing technology as part of your overall business strategy? How does the rest of the industry view and act on digital transformation? We surveyed 2,000+ global recruitment and staffing professionals to learn more. Read on for the key takeaways.

More than ever, firms are making digital transformation a priority

In our annual GRID survey, we asked staffing professionals to share their thoughts on digital transformation—the integration of technology into all areas of your business for the purposes of improving operations and the way you deliver value to customers—and how it’s impacting the recruitment industry. We found that overall, staffing professionals place more importance on digital transformation than ever before, all while feeling burdened with the challenge of change and transition.

Top Priorities for 2020
Candidate Acquisition 43%
Client Relationships 34%
Candidate Engagement 27%
Digital Transformation 26%
Employer Branding 24%

 

A quarter of all respondents cite digital transformation as an overall top priority for their business for 2020. Eighty-six percent say that digital transformation is imperative to remain competitive in the industry. Most recruitment professionals (83 percent) feel that digital transformation could help their business rather than hurt it (three percent). The enthusiasm for digital transformation is trending upwards, with a three percent increase in enthusiasm for digital transformation from 2019 to 2020.

Digital transformation is still seen as a key challenge for staffing firms

Despite most believing that digital transformation is a good thing for their business, many still aren’t taking steps towards embracing and leveraging the technologies that underpin it. It’s no surprise that technology is and will be a mainstay in staffing and recruiting, so what is holding companies back? 

We asked respondents to rank their top challenges for 2020, and they cited digital transformation as their top operational challenge (54 percent). Pair that with the number-two operational challenge of pricing pressure and margin compression, and it’s evident that businesses are hyper-focused on ways to remain competitive while increasing production wherever they can.

Top Operational Challenges for 2020
Digital Transformation 54%
Pricing Pressure 46%
Competition from Freelance Platforms 27%

 

The adoption of technology and digital transformation is still slow

Digital transformation is impossible without team-wide adoption and implementation of your staffing technology. To make digital transformation a reality, teams must embrace the productivity that comes with automating processes and adopting technologies throughout the complete recruitment workflow. 

Getting teams to fully adopt staffing technology is hit-or-miss. While 36 percent say their teams have a strong adoption of staffing technology, a sizable number report only some (27 percent) or little (14 percent) adoption overall. A somewhat shocking six percent report that their teams don’t even use staffing and recruitment technology at all.

When asked to comment on why their teams weren’t fully adopting technology, the feedback was mixed between limited training resources (28 percent), staff turnover (18 percent), and—perhaps most telling of all—the team not seeing the value in it (17 percent).

Where do automation and AI fit in?

Regardless of adoption hurdles, one thing that most staffing and recruitment professionals agree on is that firms must embrace digital transformation, with 86 percent agreeing that it’s crucial in order to remain competitive. 

While digital transformation may be a key priority in 2020 for many recruitment professionals (25 percent), there is still a large group that has a limited understanding of machine learning and AI (68 percent), two important components of digital transformation. Even with that limited understanding, most respondents (56 percent) agree that AI will, in fact, have a positive impact on candidate and customer engagement. 

 

Many firms are holding back due to fear of change

With all signs pointing towards technology and digital transformation having a hugely positive impact on staffing firms, why aren’t more firms taking advantage of them? It’s possible that a fear of change and disruption are to blame.

Twenty percent of the recruitment professionals we surveyed have never changed core technology providers within their business. Excluding those who are satisfied with their current technology provider, the top reason respondents don’t make a change is the belief that it would be too disruptive to change providers. There is a great opportunity for firms who are currently not embracing digital transformation within their business to lean forward.

20% of respondents have never changed core technology providers in their business.

What prevents you from switching to a new core staffing technology provider?

Satisfied with our current provider 41%
Too disruptive 16%
Nothing; we're looking 11%
Too Expensive 10%
No business value 9%
Senior leadership isn't on board 5%

 

New technologies are a good thing, but most firms aren’t leveraging them yet

Candidate acquisition/sourcing is a top priority in 2020 for many staffing firms (43 percent), but only 39 percent are automating the process altogether. Without embracing digital transformation during this key step in the recruitment process, businesses are leaving both time and resources on the table. Twelve percent view candidate screening and validation as a top challenge within the recruitment lifecycle, proving that there is room for noticeable gains in both productivity and profitability. 

Most recruitment professionals (58 percent) are still undecided on how online recruitment platforms, such as Upwork or Shiftgig, impact their efforts to fill sought-after roles, even though 55 percent work with these platforms regularly. 

The potential is still there for these platforms, with 28 percent responding that such platforms have helped them fill more jobs. As reskilling becomes much more necessary as a means to keep candidate pools filled for clients, firms will need to leverage process automation, culminating in digital transformation, to continue to grow their businesses. 

What’s next for digital transformation?

Recruitment professionals are in agreement that digital transformation is the future (and the present) of the industry, but the results (and the mindset) don’t quite match up to the enthusiasm for technological progress. Most have barely begun to explore the many possibilities of technology to further their business goals and unify their processes, leaving open a great opportunity to differentiate from the competition. 

Embracing digital transformation will be an ongoing journey without an end in sight, but recruitment leaders who digitize data to inform their business decisions will be well-positioned to overcome any challenge. Automation and AI, in particular, represent immense untapped potential for agencies. The results are clear: we are just beginning to realize the transformative potential of technology as an industry.

Content Marketing Manager

Bullhorn

Emily Swartz is the Content Marketing Manager for Bullhorn. She graduated from Suffolk University with a Bachelor's Degree in Marketing. In her spare time, she enjoys discovering new restaurants and hidden gems in Boston, MA.