Recruitment
Industry Predictions for 2007
A number of experts within the world of
recruitment have shared with us their predictions for next year. It looks
like 2007 will be an exciting and demanding year
for the industry.
Tim Elkington, Managing Director,
Enhance Media Limited
Pay per post or pay per click?
There will be a growing debate/conflict between models that ask advertisers to pay for job postings and models that operate
a free posting service but charge for response on a pay-per-click basis. Traditional media owners will be keen to maintain
revenue via listings while new online only businesses will challenge this position with a pay-per-click model.
Recruiters will start to use web 2.0 techniques
Blogs, podcasts and social networking sites will become important tools for online recruiters as the online space becomes
more competitive. Employers that can tap into the mood of web 2.0 will have a competitive advantage – especially in the
graduate market.
Online recruitment videos will become more popular
With the spread of broadband and on demand TV through the internet more and more recruiters will take advantage of online
recruitment videos to express their employer brand and to show candidates what it’s like to work at their
organisation.
Tom Atkinson, Managing Director,
Cash Simply
Construction
2007 will see tax deduction confusion in the construction sector as the new “no card” rules are introduced in April, making
it even more difficult for new start employment businesses to survive and grow in the sector. With a growing market it will
be good for those already holding CIS5s but we shall see new start failure rates increase above the current 1 in every 2
first year failures.
“Outsourcers”
The VAT squeeze HM Revenue & Customs is putting on incorrectly structured companies who say they are helping new starts but invoice in their
own name, we will see continue. The result will be more failures of such companies. The first one was squeezed out in
December 2006 ahead of my forecast. I expect the VAT man to go after the others now they have set a precedent. It will be an
“ill wind” however, as the correctly constructed companies will pick up more business.
Composites etc
The Chancellor’s pre Budget speech will result in frenetic activity in this sector both before and after the introduction of
new rules proposed for April 2007. This is big business and composites etc provide the only way some recruitment companies
and their clients can survive in the market. We shall see some go to the wall but those able to make structural changes to
address the new legislation will do extremely well and expand their customer base.
Fiona Lander, Managing Director,
Lander Associates Ltd
Higher standards
Professional best practice standards are becoming the norm and 2007 will reflect this, with customer expectations ever
increasing in terms of service levels, deliverables and innovation of service options from their recruitment partners
Better services to candidates
A continuation of the buoyant market place and high demand for a broad range of skill sets will create a need for continued
emphasis on the sourcing of excellent candidates and providing them with outstanding customer service.
New types of hires
For recruitment organisations themselves, the ongoing challenge of finding the right talent to support business growth plans
and meet demanding customer expectations means that many organistations (if the haven’t already done so) will move more
towards graduate and second jobber hires with comprehensive 3 - 6 month training programmes, rather than searching for the elusive experienced consultants. Recruitment methods will
need to be reviewed and the barriers for entry raised, if we are to succeed as an industry in attracting talented individuals
in competition with other major sectors vying for their career choice.
Dan McGuire, Managing Director,
Broadbean Technology Ltd
More job board consolidation
Well we saw plenty of it last year with Trinity Mirror and DMGT both flexing their financial muscles but I think that was
small fry compared to what could happen in 07. I would be very surprised if we didn't see a fair amount of activity from the
big boys picking up a few of the successful niche boards. Smaller boards with local, rather than market, niches could be very
attractive to the top 5/6 who have started to recognise the potential in local sites. But my tip on consolidation is that we
might see some top level action. I'm talking about one or two of the market leaders going after another in a mega bucks deal.
Some of the big guns may feel the top end generalist market is a bit busier than they'd like and I wouldn't be at all
shocked to see someone make a move. Whether they'll actually get a deal done is another story but it won't stop them trying.
Even more consolidation
The job boards have been at it for a while and they'll carry on as I mentioned above, but I think an interesting market to
keep an eye is the ATS (applicant tracking system) sector. The recent acquisition of Brassring by Kenexa could be just the start of a flurry of activity
in that market. Many of the big ATS companies have been massively
venture capital backed and its time to start making money or start
cutting costs. So I think the stronger players will be sniffing round some of those who are, shall we say, putting on a brave
face but need some help. Consolidating back office functions is a quick way to turn two companies performing OK into one
performing excellently and I don't think we've seen the last movement in that sector.
Everyone finally realises the UK is ahead of the game
I'm tired of hearing everyone talk about how America's had it right for years and in the UK we're two years behind them. I'm
tired of people watching what happens in the US and try to replicate it here thinking they'll make millions. And I'm
especially tired of people not giving us Brits the recognition we really deserve. I've spent a lot of time in the US this
year and in some respects they're spot on. Online is the first thought to an employer and the jobs they don't fill online go
to agencies, meaning the agencies have to raise their game (which is a good thing). I agree that, in that respect, they're
ahead. But when it comes to online recruitment we've got some real innovators. Take Robbie Cowling of
Jobserve, arguably the
first online job board in the world. It's still got probably the best PE ratio in the world. Now he's buying job boards in America
(he'd already done Australia) and people in the US can't get enough of it. Fair play to him and others like him.
Ann Swain, CEO, ATSCO (who sneaked in an extra one)
More demand for IT Skills
Demand for IT skills will continue to grow strongly. Strengthening demand in the financial services sector will be matched by a resurgent software industry as vendors upgrade products to coincide with the launch of Windows Vista.
IT for Global banks
Global banks now fully recognize the role of IT in maintaining their competitive edge. The clearest, most stark example of this is their commitment to build a global electronic stock trading platform to drive down their dealing costs and challenge the established stock exchanges.
More need for engineering
skills
Buoyant demand in the aerospace and rail sectors should ensure strong demand for engineering skills in 2007. However, recruiters may again find themselves
increasingly having to source specialist technical skills from Eastern Europe.
Getting to grips with age
legislation
2007 will be a key year for the age discrimination legislation. Recruiters in the technology sector will be on the frontline in the battle to change ingrained perceptions that candidates with technology skills should be in their 20s and 30s.
Mike Taylor, Managing Director,
Web-Based-Recruitment
Blogs
Recruitment Blogs will become more popular as companies learn more about the benefits of blogging as part of their online
recruitment strategy.
Podcasts
Audio podcasts will become more common on both commercial and corporate job sites as online recruitment becomes more
interactive.
Web video technology
There will be more video profiles of recruiting companies on their own web sites and job sites as well as more use of videos
by job seekers as part of their CV.
Ruella Crouch, Managing
Director, Ruella James
War for talent
The war for talent within the R2R sector shows no signs of abating. Clients more than ever appreciate that they need to look outside of our sector for new talent and not just within the graduate market which remains extremely competitive. In some circumstances this will mean paying higher starting salaries than previously offered to entry level recruiters who are perhaps coming in to the recruitment market with transferable skills and extensive experience from other sectors. This will undoubtedly continue during the coming year.
Move back to traditional
recruitment activity
During the last few months we have seen many candidates wanting to move away from servicing
PSL (prefered supplier list) and low margin business and instead looking to return to a more traditional recruitment role servicing a variety of accounts at more lucrative rates. Even though this will increase the sales element in their roles this does not seem to deter them as with the majority of sectors the opportunities are
there. It’s all about finding the candidates! Whether this trend will continue during 2007 remains to be seen.
Challenges in attracting and
retaining candidates
Finally, clients will more than ever need to look at how they are attracting and retaining candidates within their businesses, as the wealth of opportunities available to candidates at all levels shows no signs of diminishing. As the war for talent increases these are two areas
James Saunders, Managing Director,
4mat.com
Growth of fixed price recruitment on the
web
Companies such as Taylor Guest are already pioneering a fixed price recruitment model which uses web technology to provide
customers with a candidate shortlist for a fixed fee.
Jobs board market move to results based
charging
This means using technology to prove the effectiveness of jobs boards prior to purchase. This will not merely bring down
prices for boards that deliver poorly, but potentially put up prices for boards that deliver effectively.
Move from pay per click to pay per delivery on Google as well as jobs advertising via
Google
Google's current pay per click service is hugely open to abuse currently and steps will eventually be taken to prevent this.
In terms of jobs advertising Google have already shown intent in the development of their Google Base product.
Gabrielle Parry, Managing Director,
Saville Consulting
More sophisticated Internet
assessment
Internet assessment moves to reporting that explains the results to different stakeholders: e.g. candidates, line managers as well as trained users and Occupational Psychologists.
Psychometrics helping to
remove age discrimination
Age discrimination legislation results in an early test case involving psychometrics. Questionnaires and tests that can help to balance out age and gender trends and can demonstrate the empirical validity of each scale and
subscore will come increasingly to prominence.
Validation
Validation helps the bottom-line. Organisation performance frameworks and selection methods will be required to demonstrate by research (empirical validation) that they link to improved performance.
In other words they differentiate between high and low performers – rather than being made up of motherhood and apple pie statements that, while desirable, have no effect on improving individual and organisational performance.
Marcia Roberts, CEO of the REC.
I predict that 2007 is going to be a year of growth as our tracking surveys so far have shown there are more people employed
than ever before with even more vacancies. Another trend we have noticed is that instead of people staying in a job for an
average of five years, this has now decreased to 18 months which is good news for the permanent side of the industry. Next
year, the economy is forecast to grow between 2.8 per cent and 3 per cent, which I believe will mean that temporary workers
will also be in great demand.
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