The recruitment industry has seen a massive shift in the last few years with exponential growth and increased revenue in certain sectors. On the whole, Ciett found that the global revenue of recruitment agencies stands at over $350 billion, with over 200,000 recruitment agency branches across the globe, employing over 620,000 employees in 2013. Additionally, during the 12 month period ending August 21 2014, employment agency revenue grew at a rate of nearly 15 percent from the previous year.

Temporary and contract staffing agencies have witnessed the most dramatic growth as well as the highest revenue per recruiter in 2014 (bullhorn) while executive search firms have been rapidly increasing staff numbers since the economic recession hit the US in late 2009.

The recruitment industry widely predicts continued growth in 2015.  This growth is a result of a number of game-changers in recent years:

The Economy

The AESC reported that the overall search volume at executive search firms increased by 8.7% from 2013 to 2014.  Its President, Peter Felix, explained this phenomena, stating that:  “the correlation between economic conditions and executive search demand becomes stronger year by year, reflecting the volatility of corporate decision-making in our increasingly interdependent world”.

Simply put, economic instability has led employers to focus on the acquisition of top executive talent that are able to fulfill leadership roles and ensure company success.

The economic factors also account for the significant growth of both contract and temporary job agencies which affords employers the flexibility to hire staff on a non-permanent basis during times of economic instability.

Multiple Job Changes

In the past, employees would switch jobs between three and five times on average in their lifetime; however, this has changed in recent years.  Employees are now expected to change jobs between five and ten times in their lifetime.

Consequently, the demand for new talent has risen while the shortage of available talent has increased.  This scenario has resulted in a ‘war of talents’ that will become a prominent and severe issue in upcoming years.

This ‘war of talents’ will also impact company airings.  Whereas companies traditionally relied on internal promotions to replace outgoing employees, the shortage in talent will decrease internal movement thereby increasing the demand and necessity for outsourcing recruitment to agencies.

The Competition for Top Talent

The demand for top talent has also been impacted by the surge in development of technologies and the digital world as a whole which has elevated the demand for technological talent, both permanent and of atypical employment relationships.

Executive Search firms benefit from this development greatly as employers rely on them to source and hire specialist top talent and maintain a competitive edge to enable this.

What trends have these game-changers created for recruiters in 2015?

Shortage of talent

Industry studies have indicated that the recruitment industry is facing a trend of “hollowing out”. This trend is the organic result of recruitment automation and off-shoring of middle-skill occupations which has led to the growth in high-skill occupations and specialist jobs but a severe lack of talent to fill them.

In addition, according to McKinsey, the rapid development of technologies and economies indicate that, by 2020, employers will require between 16 to 18 million more college-educated workers than the number that will be available.  This will further increase pressure on recruiters.

Ultimately, the demand for top talent and specialist candidates alongside the ensuing competition will increase  the pressure employers put on recruiters.

Employers will demand and expect recruiters to develop new strategies and find new technologies to ensure that they secure top talent for their clients.

However, there is a silver lining.  The demand for high-skill and specialized talent is great news for executive search firms and headhunters who work work on a retained basis.

Millenials in the Job Market

Millennials are predicted to make up 75% of the global workforce by 2030, and engaging these candidates necessitates a focus on the candidate-experience and their personal needs and objectives.

For recruiters, this means tailoring and personalizing their strategies to successfully hire the millennial generation.  More focus on building networks and building relationships with top talent.

Big Data

Employers will increasingly demand industry-specific and targeted recruiting from agencies because of the industry shift and shortage of talent. This explains the recent technological innovations for the industry, with the development of tools that harness data and provide predictive analytics and accurate talent acquisition data.

Recruiters will be forced to embrace these technology trends and simultaneously fully integrate social recruiting into their strategies in order to satisfy their client’s demands.

In Conclusion

While the recruitment industry game-changers and resulting trends will put recruitment agencies and executive search firms under increased pressure in an increasingly competitive market, the cause of the pressure is also at the very foundation of the rapid  growth in the recruitment agency sector.  Ciett predicted that employment agency workers would fill approximately 13 million jobs in 2014 alone, and this has been widely predicted to continue in 2015.

Recruiters can gain tremendously from the recent industry shifts and trends on the condition that  they adjust their recruitment strategy and technology accordingly.  In 2015, recruiters must ensure that they focus on candidate-centric recruiting and the tools that enable this; the tools that harness data and produce actionable insights thereby enabling their continued success as well as client satisfaction.