Insight

Setting the Stage for 2019: The Top Priorities for Recruitment Agencies in the UK and Ireland

A new year, a new set of perspectives and priorities.

In 2019, recruitment professionals are feeling bullish and are eyeing increases in temporary placements, operating budgets, investments in technology, efforts to reskill workers through education and training, and the percentage of business conducted via VMS.

Overall, global agencies are optimistic about 2019, with 79 per cent of respondents expecting revenue to increase from 2018. Twenty-three per cent expect revenue to rise more than 25 percent, and only 2.5 per cent expect revenue to decrease. Asia-Pacific firms seem to be the most optimistic about the industry for 2019.

79% of global respondents expect revenue to increase in 2019

In terms of placements for the year, 63 per cent of recruitment professionals are expecting increases in temporary placements this year. Fifteen per cent of firms expect temporary placements to remain the same, while 3 per cent of agencies expect temporary placements to decrease.

Global recruitment businesses also anticipate increases in their operating budgets (57 per cent of them do). Europe had the highest rate of projected increase in technology investment, while North America had the least. Interestingly, there is a strong positive correlation between firms that understand artificial intelligence and are expecting increases in technology investment:

Region % Increase (All)
% Increase
(AI Understanding)
Australia and New Zealand 61% 64%
Europe 65% 68%
North America 58% 64%

Also related to technology, how do agencies feel about VMS, specifically conducting their businesses via VMS this year? The jury’s out on this one as 32 per cent of global recruitment professionals expect their percentage of VMS business to increase, while 35 per cent expect it to remain the same as last year.

Forty-seven per cent of global firms will focus on workforce reskilling efforts, or updating workers’ skills through education and training. Asia-Pacific countries were actually the most polarised region on the topic, with the highest projected increase and the highest projected decrease.

Region Increase Decrease Stay the Same
Australia and New Zealand 57% 5% 40%
Europe 51% 3% 47%
North America 54% 3% 44%
Total 54% 2% 44%

Workforce reskilling is also a highly relevant solution for candidates whose current skill sets could be automated by artificial intelligence in the near future. And therefore, it was especially interesting that a projected increase in workforce reskilling was highly correlated with an understanding of artificial intelligence:

AI Understanding Increase in Reskilling Decrease in Reskilling
Reskilling Stays the Same
No / Little Understanding 48% 2% 50%
Some Understanding 53% 3% 45%
Strong Understanding 62% 3% 36%

What Will Agencies Prioritise in 2019?

In short: candidates will be a top priority this year. Sixty-one per cent of firms listed candidate acquisition and sourcing, and 36 per cent of firms ranked engaging candidates and improving the candidate experience as their two biggest priorities. This makes sense considering that strategically identifying and sourcing candidates and providing incredible candidate experiences are two of the most effective ways to combat the talent shortage.

The days are over when you could post a job and wait for a response. You have to be disciplined about casting a wide enough net to capture the right talent.

Beyond candidates, here are some other notable priorities that recruitment businesses will focus on in 2019. We’ll explore these priorities in more detail below.

Despite the promise of creating a renewable talent tool, reskilling ranked toward the bottom of the list as only 5 per cent of global firms selected reskilling workers due to the changing nature of jobs as a top priority.

While VMS usage in the staffing and recruitment industry is increasing, it’s a priority for some firms and not necessarily a priority for other agencies — based on if VMS models are the right fit for firms and their business. That’s why only 3 per cent of firms listed expansion of VMS business as a top priority for 2019.

Embracing Digital Transformation to Improve Operations

Automation and artificial intelligence continue to be some of the hottest trends and topics in the industry conversation. Last year, dialogues swirled about the potential impact of automation and artificial intelligence on staffing and recruiting — will the robots overtake human recruiters or will they aid their work?

While we’re nowhere near a robot apocalypse that’s depicted in science fiction, bots are here to help improve firms’ operational efficiencies. How so? By automating lower-level initiatives such as scheduling, screening, following up, and data entry so human recruiters can focus on more strategic initiatives such as developing and deepening relationships — doing what humans do best.

Regionally, North American staffing firms ticked digital transformation as a priority more than European and Asia-Pacific recruitment agencies. Firms this year will focus on incorporating digital transformation into their recruitment strategies to help them become even better and more efficient at their jobs. Once automation and artificial intelligence are fully harnessed into the recruitment workflow, they’ll have profound implications on the industry at large.

This [automation] is a disruptive force. We’re going to have disruptive capital. And the organisations that aren’t able to adopt automation will perish. They won’t be able to keep pace with their competition. 

Employment Brand Development and Marketing

Most recruitment agencies lack proper marketing leadership, which explains why 30 per cent of respondents identified employment brand development and marketing as a top priority for 2019. According to a Bullhorn survey of more than 100 recruitment leaders of medium to large-sized firms, 61 percent indicated that they have neither a vice president of marketing nor a chief marketing officer.

Executives (defined in this research as C-Level executives, firm owners, and primary owners of lines of businesses) and senior managers (defined as managers, directors, and vice presidents) at recruitment firms were more focused on employment brand development and marketing than staff (defined as frontline recruiters and salespeople). Geographically, North American and European agencies were more concerned with this priority than Asia-Pacific firms.

Why aren’t there more senior marketing leaders, especially in an industry where nurturing candidate relationships is paramount? While it can be expensive to invest in seasoned marketing leaders, the result is beneficial: a cohesive marketing strategy and vision that has business impact.

Improving Management of Client Relationships

In an industry driven by relationships, improving management of client relationships is currency. After all, deeper relationships can yield more opportunities and businesses can only further grow when their client relationships flourish.

Interestingly, executives and senior managers were more concerned with improving the management of client relationships than staff, potentially indicating that frontline professionals already believe that their current relationships are strong.

How can businesses ensure that they have the strongest possible client relationships? Technology. To stay in front of the competition, agencies must embrace recruitment software to gain deeper insights into their client relationships and uncover real-time information to drive new growth opportunities.

...I still believe at its core, recruitment is very much a people business. You have to stay in touch, you have to talk to people. If you’re just texting or you’re just doing nurturing campaigns and things of that nature, you’re not gonna be able to build a rapport.

Social Recruiting

Recruiters in today’s digital age have numerous ways to reach candidates, especially via social media. Tech-savvy recruiters are increasingly turning to social media to gain intelligence about candidates and source their very own super-skilled job seekers.

Social media is an effective channel for connecting and building relationships with candidates. Recruiters can analyse candidates’ career and education experiences via LinkedIn, view their topics of interest via Twitter, dig deeper into their personas via Facebook, and understand their cultural and lifestyle interests via Instagram.

What do firms think about social recruiting as a top priority for 2019? North American and European firms were more likely to engage in social recruiting this year than their colleagues in Asia-Pacific. And enterprise firms were about 50 per cent less likely to list social recruiting as a top priority.

Succeeding in social recruiting is all about having a strong web presence, which not only helps attract new candidates but also helps secure new clients.

It used to be exclusively about having relationships or keeping the same clients. Now, every single day we work with new clients who find us through Google.

Expanding into New Markets

As agencies grow their businesses, they’ll undoubtedly establish operations in new markets and develop brand recognition in strategic geographies. In order to expand into new regions, should recruitment agencies grow organically or inorganically? In other words, should they build their own operations or buy current businesses to enhance their portfolios?

At Engage Boston 2017, we asked our attendees that question, and 69 per cent of recruitment professionals said they preferred to build their organisations organically, while 31 per cent said they favoured growing their businesses through mergers and acquisitions (M&A). Fast forward to 2019, and, according to our research, North American and European firms are more likely to focus on expanding into new markets than Asia-Pacific agencies.

Why are recruiters focused on new market growth, and why are some of them expanding via M&A? Strategic M&A deals by larger firms and the proliferation of recruitment investment from private equity firms will continue at a steady pace for two reasons: private equity sees the financial appeal of capitalising on an industry with low barriers to entry and comparatively low capital expenditures, and debt is cheap.

According to Staffing Industry Analysts, 2017 saw a 28 per cent year-over-year increase from M&A activity in 2016 and the second highest annual deal volume over the past decade. These findings signal that M&A activity will continue to heat up within recruitment.

There’s a real business benefit to putting two organisations together. You can create a combined organisation that’s ready to disrupt the industry. That’s why you’re seeing all this M&A activity in recruiting.

It’ll be interesting to see how businesses tackle their priorities for 2019 and how they’ll use each of these strategies to grow their businesses. Will any of these priorities change as the year unfolds, or will any new ones rise to the top? Only time will tell.

insight
What did recruitment agencies in the UK and Ireland cite as their top challenges for 2019?

Steve Vittorioso

Senior Media Relations Manager

Bullhorn

Steve Vittorioso is Bullhorn’s senior media relations manager, overseeing global public relations. A former print journalist turned high-technology PR professional, he manages the company's global public relations efforts and develops and cultivates working relationships with the global media. He is a graduate of Providence College, armed with a degree in American studies and writing.