It’s that time of year, isn’t it? When we review what happened during the year that has just finished, but more importantly, look ahead to what’s to come.
I always take time out to think about how things might change during the 12 months ahead – and to look at whether I need to tweak my business to take account of such changes. So here are my thoughts on how the recruitment industry, and the markets we work with, could evolve during 2019.
The big picture
Across our client base of financial technology organisations, I predict we’ll see increased market consolidation. Expect acquisitions of smaller software firms by the bigger boys, being supported by private equity investment.
Artificial intelligence (AI), and other innovative technologies are going to have an increased impact on the recruitment industry. Anyone who wants to succeed in this business will need to embrace this to maintain a competitive advantage. It’s an exciting trend; used well, AI helps organisations to work smarter and be more efficient.
Online video is a hugely fast-growing trend. Cisco predicts that 82% of all internet traffic will be video by 2021 – that’s only the year after next! Video is a fantastic tool for reaching a larger audience and driving engagement with them, ignore it at your peril.
As the use of digital media becomes ever more prevalent, recruiters need to think more like marketers. By treating a candidate as a customer, you’ll improve your chances of success. According to LinkedIn, 70% of candidates are passive job seekers. So you need to go after them with a strong online presence, strategic social media, remarketing and other marketing tools.
What challenges will we face?
As in many industries, uncertainty rules. The consolidations mentioned above rock the market when they happen. Brexit inevitably delays decisions and uncertainty in the market due to the changing landscape will mean we all have to be a bit more agile.
Increased regulations, including GDPR that was introduced last year, and specific vertical sector regulations – examples in our client base include MIFID 1/MIFID 2 – all contribute to distraction, uncertainty and in many cases, increased costs.
Thanks in part to the growing regulations, standards are rising in recruitment. I expect to see compliance higher up the agenda for many organisations. Background and reference checking, data privacy, and security are all aspects that recruitment companies must focus on. It’s a positive move as it helps to remove the less professional side of the industry, but is not without its challenges to do properly.
One thing’s for sure, competition isn’t going away any day soon. During 2017, an average of 818 new agencies registered each month. And as of May 2018, over 3900 had been registered. And it’s not just new agencies that increase competition, there is a rise in ‘internal recruitment teams’, with organisations choosing to head-hunt directly from the market.
And what are the opportunities?
Of course, uncertainties in the market also bring opportunities if you are willing to grasp them.
Yes, the market may be consolidating, and there are challenges that need facing, but it’s also growing at a rapid pace. Since 2010 the market has grown in size consistently every year. It’s now worth well over £30bn and is forecast to grow by 3.6% in 2018/19 and 2.7% in 2019/20.
It’s never been more important to develop and communicate your market niche. Offer clients specialist market knowledge and expertise, and you’ll be much better placed to take your share of that growth. And don’t forget that your network is key – without it, you’re facing an uphill struggle.
Finally, when competition is so fierce, it is service focused firms that will take the advantage. Be clear on your positioning, build your digital employer brand, and you’ll stand out from the crowd and be able to engage with the best talent.
Here’s wishing a successful 2019 to all everyone reading this, whatever industry you may be in.