The staffing industry is quickly adapting to meet the changing needs of modern businesses by altering operations and increasing the use of modern technologies like recruiting software. As employment trends continue to impact the recruiting sector, professionals experienced in staffing will find that learning to maneuver and meet clients’ needs in the evolving marketplace may require different things than in years past.
Mike Cleland, founder of Charted Path LLC, and author of the book titled, “Behind the Wheel: Driving Excellence in Staffing Operations,” recently sat down to talk with us about the changing state of the staffing industry and how having the latest recruiting software really makes a difference.
Greater adoption of contingent labor
While it’s no surprise to staffing professionals that there has been increased reliance on contingent labor than in past years, it is important to note that not every industry is using these forces in the same way or frequency. Professional services like IT and healthcare are using contingent labor in a much different way than clerical or administrative services.
“I think the [greater adoption of contingent labor] is impacting different segments in different ways. In the IT staffing area I do think that more consultative staffing companies will be providing greater and greater value as the labor market continues to tighten. In contrast, high volume transactional staffing firms may struggle as the readily available talent pool continues to shrink,” said Cleland. “This is certainly anecdotal, but from an IT perspective, from what I’ve heard, there is more work coming back from offshore companies. If that is the case then there will be more projects and more project-based jobs that have a beginning and an end. Contingent workers will be the answer to this employment situation if that is going on.”
As the labor market continues to shift and the adoption of contingent and part-time labor increases, staffing firms will have to alter behaviors and offer even greater services at affordable rates. To take advantage of this shift, utilizing the right staffing and recruiting software will allow recruiters to stay competitive. According to Cleland, the open talent pool is creating a much more competitive market for recruiters.
“For high-demand talent as the labor market tightens the staffing firms who have recruiters with more traditional networking and sourcing skill will have a greater and greater competitive edge. Tools like LinkedIn are accelerating this trend back to referral-based recruiting because research and selection is being driven by a network of talent,” he said. “On the lower skilled temp sector side of the business, managing an inventory of reliable temp resources is critical and proving to be a greater and greater challenge. Firms that are disciplined in building and managing their candidate inventory will prove to find themselves with greater competitive advantage if the labor market tightens.”
Demand for staffing services expected to increase
With the adoption of contingent labor increasing, the services of staffing and recruiting professionals will play a larger role in employment. Contingent labor offers greater flexibility to both businesses and workers, which is boosting its popularity. To handle this surge in popularity, the right staffing and recruiting software will allow professionals to operate with efficiency in the face of increased demand.
“I think that the contingent trend is going to become more and more important part of the labor pool, which means that staffing has a very strong future, but firms have to continue to improve their people and processes to remain competitive. Either way the demand is not going anywhere but up,” Cleland said. “The underlying uncertainty [of the economy] and labor costs means that not a lot of firms want to hire permanent talent. In addition, the ACA may also be playing its part in spurring on the use of contingent labor even with the delay of the employer mandate. However, for high demand labor, part of the trend toward contingent labor is driven by the talent who simply prefers contract based work. A lot of those high demand workers prefer project-based work because it tends to accelerate skill set development and provides greater control over their career path.”
Opinion on contingent labor trend differs between generations
Not every generation is on board collectively with the switch to contingent labor. Older generations that grew up with the idea of stable, long-term employment view work in a different manner than younger generations. With younger workers adapting and more companies becoming comfortable with contingent labor, the tides of change are upon the market. Having staffing and recruiting software that allows you to adapt to generational workers allows you to place the right workers in the right position.
“Companies are becoming more comfortable with contingent labor and the culture associated with using this type of labor. It has also become a more acceptable way to procure talent and a more acceptable way to work. This is partially due to the changing generations. Generation X, the people who are moving into or in current management positions have very different expectations of what it means to work for a company,” said Cleland. “As a Gen X, we don’t mind moving from company to company and most people from this generation show a certain amount of movement on their resumes. Statistics show that how many people change careers, not even jobs, during their lifetime has grown and this is very different than what it was 40/50 years ago.”
According to a study by Future Workplace titled, “Multiple Generations @ Work,” 91 percent of Millennials, defined as those being born between 1977 and 1997 (which also includes Gen Y for the purpose of this article), expect to stay in a job for less than three years. This means that the average Millennial will have between 15 to 20 jobs during the course of his or her working life. Another study from social researcher Mark McCrindle claims that those of this generation will change careers five times.
“Gen Y is even more comfortable with this approach to work than Gen X. For Gen Y, jobs are more about an interest and enjoyment than stability. There is no thinking that you’re going to be with a company for 20 years and employers understand this now and they know people are not going to be with a company for long. As a result, businesses are more focused on procuring talent and retaining the right employees because employees are more than likely open to looking for other jobs,” said Cleland. “For the younger generations a job is more about the work. What is being done and is it challenging and interesting [is important to millennial workers and they often believe that if] you ever get bored it is time to move on. This is a very different mentality than baby boomers who have a completely different expectation on work and are more apt to stay with a company for the long haul.”