burning priorities of the employment and recruitment industry in … · source: staffing industry...
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© 2015 Crain Communications Inc.
John Nurthen Executive Director Global Research [email protected]
Burning Priorities of the Employment and Recruitment Industry in an Ever-Evolving Competitive Landscape
© 2015 Crain Communications Inc.
Ciett World Employment Conference Rome, 28 May 2015
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Our Clients provide us with a Global Perspective
• Suppliers to Staffing Firms
• Investment Banks & Consulting Firms
• Staffing Firms
• Clients of Staffing Firms
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Staffing Industry Analyst’s Clients
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Burning Priorities
• Definition
• Reputation
• Privation
• Disintermediation
• Automation
• Sophistication
© 2015 Crain Communications Inc. Source: Staffing Industry Analysts
Staffing Industry
Temporary Staffing
Place & Search
Extended Workforce Eco-System
© 2015 Crain Communications Inc. Source: Staffing Industry Analysts
MSP
RPO
Payrolling
Online Staffing
PEO
Staffing Industry
Talent Engagement
Temporary Staffing
Place & Search
Extended Workforce Eco-System
© 2015 Crain Communications Inc.
Extended Workforce Eco-System
Source: Staffing Industry Analysts
MSP
RPO
Payrolling
Online Staffing
PEO
Job Boards
Outplacement
BPO
Consulting Services
HR Consulting
VMS
Training
IC Compliance
Crowdsourcing
Online Services
ATS
FMS
Staffing Industry
Talent Engagement
Other Talent Solutions
Temporary Staffing
Place & Search
© 2015 Crain Communications Inc.
Extended Workforce Eco-System
Source: Staffing Industry Analysts
MSP
RPO
Payrolling
Online Staffing
PEO
Job Boards
Outplacement
BPO
Consulting Services
HR Consulting
VMS
Training
IC Compliance
Crowdsourcing
Online Services
ATS
FMS
Staffing Industry
Talent Engagement
Other Talent Solutions
Temporary Staffing
Place & Search
The Human Cloud
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Contingent Work by Value
Source: Staffing Industry Analysts
Total value globally in 2013
= €2.4 trillion
Agency Temps
€267bn
Other Temps
€507bn
Independent
Contractors
€794bn
SOW
€808bn
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Burning Priorities
• Definition
• Reputation
• Privation
• Disintermediation
• Automation
• Sophistication
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Restrictions on Temporary Agency Work
Restrictions Member States
Replacing striking workers Austria, Belgium, Bulgaria, Croatia, France, Greece, Hungary, Italy, Poland, Slovenia, Spain, UK
Sectoral bans re. Health & Safety grounds Belgium, Croatia, France, Greece, Poland, Portugal, Slovenia, Spain
Public sector restrictions Belgium, Greece, Spain
Construction industry Belgium, Germany, Greece
Limited reasons for temporary agency work
Belgium, Finland, France, Greece, Poland, Portugal, Romania
Limited duration of assignments Belgium, France, Greece, Italy, Poland, Portugal
Prohibition after dismissal of workers for business reasons
Croatia, France, Greece, Italy, Poland, Slovenia, Spain
Limitation of numbers/proportion Austria, Netherlands
Source: European Commission – Updated by Staffing Industry Analysts
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ISRAEL SPAIN
SOUTH AFRICA POLAND
GERMANY
TAIWAN
Protests Against Temporary Work
INDIA NORWAY PAKISTAN
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Burning Priorities
• Definition
• Reputation
• Privation
• Disintermediation
• Automation
• Sophistication
© 2015 Crain Communications Inc.
Ageing Population
Source: Ageing Societies, Steve Beales, Imperial College London
Number of People of Working Age (15-64) for Each Person Aged 65+
11.75 working people to one aged 65+
8.5 working people to one aged 65+
3.9 working people to one aged 65+
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Global Skills Index
Source: Hays & Oxford Economics, 2014
-1,50 -1,00 -0,50 0,00 0,50 1,00 1,50 2,00
Belgium
Italy
India
Netherlands
UK
France
Australia
Brazil
Canada
Mexico
Ireland
Japan
Russia
Germany
Spain
US
Sweden
3.3 4.0 4.5 5.0 5.5 6.0 6.5 7.0
Increasing pressure Decreasing pressure
Hays Skills Index data derived from:
• Education Flexibility
• Labour Market Participation
• Labour Market Flexibility
• Talent Mismatch
• Overall Wage Pressure
• Wage Pressure in High Skill Industries
• Wage Pressure in High Skill Occupations
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EU27 Population with/without Immigration
Source: Eurostat
540m
520m
500m
480m
460m
440m
420m
400m
With migration Without migration
Decline starts 2012
Decline starts 2035
Without Immigration European Population Would Already be in Decline
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Burning Priorities
• Definition
• Reputation
• Privation
• Disintermediation
• Automation
• Sophistication
© 2015 Crain Communications Inc.
Online Staffing: The Same and Different
Temporary Staffing
Online Staffing
FreelanceWorker
Freelance
Platform
Clients
Temporary Worker
Private Employment
Agency
Clients
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Online Staffing Platforms by Country Started
Online Staffing Dominated by China and US
Source: Staffing Industry Analysts
0 10 20 30 40 50 60 70 80
Other APAC
Africa & Middle East
LATAM
Other Europe
Israel
France
Spain
India
Canada
Japan
Australia
UK
US
China
196 Online Staffing
firms in operation
globally
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Online Staffing Online Services
Source: Staffing Industry Analysts “Online Staffing” Industry Segment Forecast Through 2020 – Jan. 2014
Fastest Growing Part of the Staffing Industry
• Online staffing estimated €1.5 billion in global revenue in 2014
• Forecast growth to 2020
Conservative
– €11 billion (CAGR of 40%)
Quite plausible
– €14 billion (CAGR of 50%)
Aggressive, but possible
– €32 billion (CAGR of 60%)
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Burning Priorities
• Definition
• Reputation
• Privation
• Disintermediation
• Automation
• Sophistication
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“The secular price decline in the real cost of computing has created vast economic incentives for employers to substitute labour for computer capital.”
Carl Frey and Michael Osborne
Frey & Osborne
47% of total US employment is at risk of replacement through automation over next 10 to 20 years
– Predictions are based on current and near-term technological breakthroughs and did not consider the impact of any future technology inventions
Given more recent advances in machine learning (data mining, machine vision, computational statistics, etc) and mobile robotics, the next technological wave will increasingly hit higher-skilled white-collar jobs
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Probability of Computerization Over Next Two Decades
Job Probability of Computerization
Recreational Therapists 0.003
Dentists 0.004
Athletic Trainers 0.007
Clergy 0.008
Chemical Engineers 0.02
Firefighters 0.17
Actors 0.37
Health Technologists 0.40
Economists 0.43
Commercial Pilots 0.55
Machinists 0.65
Word Processors & Typists 0.81
Real estate sales agents 0.86
Technical writers 0.89
Retail Salespersons 0.92
Accountants & Auditors 0.94
Telemarketers 0.99
Source: Frey &Osborne
+0.7 = High Risk
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What Do We Mean by AI and Robotics?
Software substitution through cognitive computing applications
Drones
Bots
Robots
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Impact of Automation on the US Staffing Industry
Staffing Segment Probability of Computerization
Office/Clerical 0.814
Industrial 0.796
Commercial 0.802
Finance & Accounting 0.845
Clinical/Scientific 0.413
Marketing/Creative 0.364
Other Professional 0.346
IT 0.278
Legal 0.275
Education 0.252
Healthcare 0.242
Engineering/Design 0.233
Professional/Specialty 0.327
TOTAL TEMPORARY STAFFING 0.719
Source: Staffing Industry Analysts
63% of all temporary agency jobs susceptible to replacement over the next 10 to 20 years
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Competing Against the Machines or Running With Them?
Can AI and automation be harnessed to develop broader and better staffing services?
Source: www.workfusion.com
– Workfusion sources, trains and manages a hybrid workforce of machines and people to undertake repetitive data-driven tasks
Leveraging three key resources: automation tools, crowdsourced workers, and so-called “employee experts”
– Is the human-machine hybrid the staffing model of the future where machine algorithms perform high-volume repetitive tasks and freelance or temporary workers perform tasks that require more judgment and analysis?
© 2015 Crain Communications Inc.
Burning Priorities
• Definition
• Reputation
• Privation
• Disintermediation
• Automation
• Sophistication
© 2015 Crain Communications Inc.
The Inevitable Growth of MSP
2%
3%
8%
11%
19%
28%
32%
34%
40%
44%
86%
Australia
France
The Netherlands
UK
US
India
Spain
Japan
Canada
Belgium
Germany
Source: Staffing Industry Analysts – 2014 VMS and MSP Supplier Competitive Landscape
2012/2013 MSP Growth Spend by Country
131
100
190
(Number of Programmes)
51
93
59
1,674
148
63
113
277
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• Employees – Full time or part time – Apprentices, trainees, and paid interns
• Non-Employees – Temporary workers – Independent contractors or consultants/freelancers – Online workers (e.g. micro tasks, crowdsourced, etc.) – Professional services (e.g. management consultants, lawyers) – Outsourced services (e.g. security guards, maintenance) – Partners (e.g. supply chain, partnerships, joint ventures) – Formal and informal volunteers (e.g. self-service customers) – Franchisees/affiliates/associates (e.g. marketing, sales activities, etc.) – Robots/drones/cognitive computing applications
Source: Staffing Industry Analysts, Global Total Talent Management Survey, May 2015
Work Undertaken by Employees and Non-Employees
© 2015 Crain Communications Inc.
What is Total Talent Management?
Total Talent Management (TTM) refers to an employer’s practice of routinely considering TOTAL TALENT when it comes to talent acquisition or management. For example, when there is a job to “fill”, an employer that practices TTM will consider various options such as hiring an employee, using a contingent worker, acquiring a robot, etc. And when thinking about “engaging” talent, an employer that practices TTM will design programs/approaches that engage ALL Talent, not just employee talent.
Source: Staffing Industry Analysts, Global Total Talent Management Survey, May 2015
© 2015 Crain Communications Inc.
Examples of Total Talent Initiatives
• Kelly Workforce Solutions – KellyOCG service line – “A Total Talent Approach” – “A holistic approach to talent acquisition and management”
• Randstad Integrated Talent Solutions Group – Launched in January 2015 – “A holistic capability offering…”
• Volt Consulting Group – Total Talent Management Solutions – Blending recruiting of both contingent and perm workers
• Peoplefluent – A total workforce management solution that spans the acquisition
and management of your hourly, salaried, and contingent workers
• Tapfin – Integrated Resource Fulfilment
© 2015 Crain Communications Inc.
Pricing Transparency Imminent
• The Talent Data Exchange is a suite of data aggregation and analysis tools developed by Brightfield Strategies
– Ongoing, validated data and analysis related to the pricing, performance and quality of suppliers and contingent workers
– Direct relationships with VMS providers providing transactional and aggregated programme performance data from large, global users of contingent workers
– Unsurpassed by other data sources – Only source of data that is independent of suppliers and is neutral
and representative of the market – To incorporate FMS, ATS & HRIS data
providing a gateway to……. Total Talent Management
© 2015 Crain Communications Inc.
Burning Priorities Summary
Acceleration Extinction
© 2015 Crain Communications Inc.
John Nurthen Executive Director Global Research [email protected]
Any Questions?
© 2015 Crain Communications Inc.