Agency owners focus on flexible work options and their databases (at last!)

Two weeks’ ago in my blog Leaders need to investigate these two critical areas of their business, I recommended a basic framework for how a recruitment agency owner or leader might usefully review their business given the impact of COVID-19.

Very helpfully, local industry vendor, JobAdder, has provided an almost immediate insight into what industry owners and leaders are doing, and considering doing, as a result of COVID-19. JobAdder’s publication The Impact of COVID-19 on Recruitment Agencies: Survey results from 700 recruitment agency owners and leaders, May 2020 was released late last week.

Where I was more pessimistic than many respondents

Although 35 per cent of respondents had already reduced headcount, 43 per cent of respondents indicated that they were going to recruit more employees in 2020 (15% nominated this hiring would occur before June, 13% nominated after June and 15% predicted they would hire later this year).

This result points to a high degree of optimism that there will be a return, relatively soon, to some semblance of normality in terms of using recruitment agencies.

I find this result very encouraging although my own view about this likely return to somewhat-close-to-normal agency usage is much more bearish. I hope I am wrong.

The result that points to a very positive industry-wide change

Our industry’s staff turnover rate has been abysmal for a long time.

The three major causes of this turnover are; the ineffective recruitment practises that dominate the hiring of people to work as recruitment consultants (“He/she looks good, is likeable and confident; let’s make then an offer”); the erratic way in which employees are inducted and developed in the crucial first six months of their employment and the failure to provide flexible working practises that would, most likely, retain a high proportion of talented women that otherwise leave the industry.

Among the post-COVID-19 changes being considered by respondents were: More flexible working/working from home (nominated by 66% of respondents), staggered office attendance (28%), changing start and finish times (23%) and hiring remote employees (21%).

No doubt the removal of the daily commute (nominated by 71 per cent of respondents as a positive of the COVID-19 restrictions) has been a major factor in the conversion of the work-from-home skeptics. Only 18 per cent of respondents will have all employees back in the office when restrictions are fully lifted. Work-from-home for 1 to 2 days per week was the most common (40% of respondents) work-from-home scenario from the 82% of leaders who were indicating work-from-home will still be an option for employees when restrictions are eased.

Although these results only indicate what is being considered or predicted, it does closely align with the feedback I have received from owners in my recent conversations; many of whom admit they are converts to the benefits of work-from-home.

Overall it does point to an encouraging change of mindset across our industry, one which, if acted upon, could significantly lower the recruitment industry’s staff turnover.

The immediate business process improvement that delighted me

The three most popular options selected in the JobAdder survey were; Cleaned up our database (61%), followed by Conducted or attended training (48%) and Made improvements to the way our database is used (48%).

As I one of the topics I got on my high horse about very early on in my blogging, and one I often return to, I am heartened to see that owners recognise the unique opportunity that a slowdown in business provides to reset the clock on database protocols and habits.

Effective database usage remains one of the most cost-effective ways to improve consultant productivity, followed by the significant impact that regular training can provide to the skills, confidence and productivity of each consultant.

I certainly hope the current focus on these two areas is a catalyst for an ongoing raising of the bar in both database usage and training.

The JobAdder report has captured the views of 700 owners and leaders at a moment in time. It will be fascinating to see what a similar survey, of the same population, might reveal in August if the next three months doesn’t provide us with the sustainable green shoots we are all hoping for.

3 Comments

  1. Brett Iredale on 21/05/2020 at 3:33 pm

    Hi Ross

    Yes, we plan to keep running the survey and improving the way we capture and deliver it each time. Future surveys will contain more demographic and agency size data so people can compare more directly against agencies like theirs.

    Nevertheless, other data points also provide an excellent lens on the market. For example, one I find valuable is the actual recruiter numbers. Our user base shed 1000 users in April. In May, however, that number is just -50. So on the whole, across our agency base, the aggregate job losses have slowed almost to a stop. (Keep in mind that agencies are still trimming headcount – but they are almost exactly matched by others who are slowly growing again).

    Job volumes are also rising slowly (actual job orders), and placements are following suit. The volumes are well below 2019 volumes but are slowly increasing.

    We wait now to see if sustained growth follows, or if we remain in a holding pattern for a few more weeks/months/quarters. I am predicting slow but steady growth for the remainder of 2020 in ANZ.

    • Ross Clennett on 22/05/2020 at 10:35 am

      Great, thanks Brett. I am looking forward to future updates.

      The results of segmented data will be even more valuable as the current environment is having an impact on the recruitment industry, that is varying greatly across sub-sectors (as no doubt the JobAdder internal data is telling you).

  2. Georgie Lord-Wilson on 22/05/2020 at 12:03 pm

    These are great insights. It is good to see businesses recognising how critical their recruitment tech is to effectively deliver to their customers (candidates and clients alike).

    By investing (time and/or money) in getting these cleaned up and focusing on processes that serve their business, not only will they likely see big productivity gains, they will start collecting serious data that tells a real story about their business, how they are performing and provide them with powerful customer insights.

    Making sure that your users are engaged with the tech is just as critical, afterall, they’re the ones that need to put the information in. If consultants have context and see value in why they are doing things a certain way, their engagement is significantly increased and a business can see real results from those behavioural changes.

    Nothing shines a light on poor systems usage/engagement more than working from home!

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