Environmental Scan of Technical Recruiting Industry - As I See It !!

Social Trends:
• Demographic Shifts
o Days of the Account Executives in the designer suite and expensive sadden are LONG GONE
o Companies are limiting the amount of money vendors and suppliers are allow to spend on lunches and gifts with hiring managers
o Smaller technology centers are struggling; technological companies are moving back to Silicon Valley, San Francisco and California in general – after the mass-exodus after the dot-com demise.
o Although the technology is denominated by males, the number of females entering the technology industry is increasing.
o Significant amount of technology workers are recent green card holders, H1-B Visa students or F1-VISA students from a foreign country (significant numbers from India and China.)
o English is often a second language to 50-60% of prospective workforce
o With looming economic issues, prospective technical talent is less likely to consider changing employment

• Cultural Changes
o Technical talent is much more hesitant to talk with recruiters (headhunter syndrome.)
o Significant amount of recruiter inquires are generated by recruiters in call centers in a foreign country
o The colleges in the United States produce a third of the college graduates from China and India.
o Communication skills and abilities (both verbal and written) is a significant issue when deciding on hiring a prospective candidate as an employee.
o Technical talent wants to be sold on the technology and career growth opportunities – and not just on a job description.

• Macroeconomic Conditions
o Bill Gates has asked Congress to increase the number of H1-B VISAs
o Media expectations of future recession
o Increasing number of mortgage foreclosures
o Prices of oil is expected to hit $400 a barrel
o Although property values may be losing value in other parts of the United States and Northern California, values in San Francisco and many areas of Silicon Valley keep decent values even during difficult times in other parts of the country
o Bay Area technology salaried positions are some of the highest paid in the country – if not the world.
o California is working hard on enticing software and technology firms back to the State

• Consumer Income
o Sales of computers is done; computer companies like Yahoo!, Intel, Dell and others have announced layoffs; others have reported inability to meet sales records/projections or huge declines in sales
o Hiring companies are looking to reduce hiring expenses and are demanding a smaller margin from average staffing agencies or firms.
o Hiring managers might end up being a candidate instead of being a paying customer

• Changing Technology
o Windows verses Linux/Opensource
o Phone costs have reduced significantly recent – due to VOIP and mobile technologies
o Most applicant tracking systems (ATS) provide all the same options – ranging in price and number of employees the system supports (otherwise, they are all pretty much the same – accept for the price !!)
o Major ERP manufacturers (SAP, Oracle/Peoplesoft, ADP / Virtual Edge, etc.) are all trying to seduce small firms (both hiring companies and staffing agencies) by providing ERP, ATS, VMS (vendor management systems) and enterprise solutions that help them run their business – and bring in new customers
o Opensource solutions can often provide the same applications as very expensive systems

• Technology’s impact on customer value
o Customers utilize technology – so expect a reduction in the margin and fee
o Following recruiting strategy and proven procedures increases your rate of placement and quality of customer services provided

• Alternative forms of competition
o Utilizing recruiting exchanges at ATS and VMS (Vendor Management Systems) helps to organization constant recruiter and agency inquires, while providing technical solutions/reports and a system of reducing costs and getting more exposure to your employment requirement
o People can be sourcing and recruiting for your requirements 24 hour a day, thanks to call centers and recruiters located in India and other parts of the world.
o Hiring companies often compete with agencies and staffing firms on the same employment websites, user groups, technology social networks, etc.
o Start-up technology companies are often very cautious – because of the rumors of what happened during and after the dot-com years and Year 2K
o Small business working from home-based offices are causing new competition for major staffing firms and agencies (allows recruiters to work whenever they want; hiring managers pay less !)
o Staffing firms are able to make more placements even though at a small, reduced rate and margin

• Components of Competition
o Recruiting Exchanges
o Applicant Tracking Systems (ATS)
o Vendor Management Systems (VMS)
o Linux or Windows operating system – whole office system architecture and solution selection depends on the operating system and platform selected

• Laws Protecting Competition
o Privacy Act
o Equal Employment Opportunity Regulations (including consideration of H1-B VISA prospects)
o Individual State and City Ordinance and Laws
o Signed non-compete and/or non-disclosure agreements and contracts former employees signed with prior employers

• Laws affecting marketing mix actions
o In 2007, 133k Applications for 65,000 H1-B VISAs was received – the majority of them were from Indian-based consulting firms like Infosys and Winpro (others like Tata Consulting, Satyam, Cognizant, and Accenture were right up there as well
o A significant amount of college graduates coming out of US based colleges are foreign students on F1-B VISAs.

• Self-Regulation
o Industry was self-regulated prior to the 80’s, but the industry was de-regulated during the Reagan years.
o Organizations like the Society of Human Resources (SHRM), National Association of Staffing Professionals (NAPS), Electronic Recruiters Exchange (ERE) and others are working with government offices to bring respectability to the industry as well as regulations and input to changes in law.
o Same organizations constantly preach ethics and moral business practices in an industry often associated with unethical and unscrupulous business practices.

Views: 61


You need to be a member of RecruitingBlogs to add comments!

Join RecruitingBlogs


All the recruiting news you see here, delivered straight to your inbox.

Just enter your e-mail address below


RecruitingBlogs on Twitter

© 2024   All Rights Reserved   Powered by

Badges  |  Report an Issue  |  Privacy Policy  |  Terms of Service