The end of the year is always a good time to reflect on the past -- and the future.
Looking back, in June of 2009, the American Staffing Association Staffing Index bottomed out, after a loss of 1.14 million jobs – 37 percent of its workforce. Since then, the staffing and recruiting industry has seen month-over-month improvement. In fact, the U.S. Bureau of Labor Statistics says the number of workers employed through staffing firms has hit a new high of 2.9 million, accounting for about 2.1% of the nation's workforce.
Yet total unemployment is still much higher than economists and the Fed would like it to be (the more accurate U6 rate, which includes the unemployed, the underemployed and those who are not looking but want a job, is at 12 percent). Combine that with a gyrating business market marked by political and global uncertainties, and many would argue that the recession has not ended, only extended its run.
For staffing and recruiting companies, that means that, even if business is better now than in 2007, savvy staffing agencies must find new means to grow their business and increase their relevance as partners to their customers.
Sure, the task for staffing and recruiting companies remains the same. Find a client with work to be done. Find a candidate that can do the work. Broker the work of the candidate to the client and make some money from that work. That is of course where the advantages of a fully-integrated staffing software comes to the fore – enabling staffing and recruiting companies to automate tasks and handle operations more efficiently and profitably by reducing operational overhead.
Yet even with unemployment high – creating a deep labor pool whose resumes are flooding the inboxes of staffing and recruiting firms with every job posting – many thousands, if not millions of possible jobs go unfilled. How in the world can THAT be?
An article in the Bloomberg Business Week by Vivien Lou Chen pointed at one reason that most staffing and recruiting companies are all-too-familiar with. Lack of the right skills needed for the jobs today. That is certainly not a new phenomenon, as anyone who has been in the industry for any length of time will tell you. What has changed is that many companies would prefer to hire only those who can literally hit the ground running and be productive with the skills and cultural fit that is exactly right for the position. Otherwise, they would rather wait, thank you.
So what is the forward-thinking staffing and recruiting company to do about that? The article suggests the opportunity that lies in the challenge.
What if staffing and recruiting companies helped candidates develop the skills needed for the jobs that clients are hiring for?
Some staffing companies have already implemented tutorial programs that enable candidates or current employees to master new skills. Some offer more extensive online training and development programs, typically in broader staffing segments, such as office or clerical. In a few cases, staffing firms are offering specialized training programs for specific staffing niches, such as the energy industry.
But what about taking that concept to an entirely new, higher level? Couldn’t staffing companies determine what employers are really looking for in candidates, then work with learning centers to develop the courses needed to develop candidate skills? Imagine the possibilities for candidates, customers, and the staffing agencies!
For example, I just received a catalog of continuing education courses from a local university. A significant fraction of them could be considered business-oriented, but may not be focused on specific business needs within the area. Why aren’t they? My guess is that it’s because the courses are determined by the skill sets of the teaching professionals and the university’s administration, with little relatively input from the business community.
Couldn’t they be more targeted if there were more input from recruiters and staffing companies (with job orders from local businesses in hand)? Why not then extend their recruiting skills to potential candidates and engage them to learn, offering scholarships, apprenticeships, job guarantees or other incentives to develop the skills that employers will pay for? Oh, and it would also give the staffing agency a skilled and ready pool of in-demand candidates.
But that would really kill already tight margins, right? Would it? If your clients knew you were not a ‘body shop,’ but a partner in their workforce planning and execution, wouldn’t they be more likely to use your services? If they know the candidates you offered were recruited and trained-up based on their skills needs, wouldn’t they be willing to pay a little more to cover your costs? If you had better control over your talent pool – through ongoing training and development – wouldn’t that improve your ability to compete?
In the staffing and recruiting business of today, it is no longer enough to sell, recruit, and fill the assignment. The future of staffing may be that – to be truly profitably competitive – you have to sell, recruit, train, develop, THEN fill the assignment. At a completely justifiable and higher profit margin – because your clients helped you design and develop a recruiting and staffing program that fits their needs.
Is this the future of staffing? To become a true partner in workforce development?