Market Indicators
Global Spotlight on the US
DESPITE BEING A MATURE MARKET, THE US HAS MUCH TO OFFER FOR RECRUITERS — IF THEY CAN OFFER EXCEPTIONAL SERVICE IN A TOUGH ENVIRONMENT “One thing I love about America,” says Morgan Kavanagh, a director at recruitment firm SThree’s New York office, who moved from the UK in 2006, “is that being a commercial person or in a sales-orientated business is not a dirty word. It’s very much a culture that celebrates success in business.” Although ambitious UK recruiters often look to the Far or Middle East, Kavanagh says the US has much to offer. But as a mature market, there are no easy wins. “If you are a good recruiter and you do have a genuinely valuable service… I think you can do more in the US than you can do anywhere else on earth,” he says. “But you’ve got to be good enough.” The US agency marketplace may be in relatively rude health (see data right and below), but there are serious concerns about the country’s labour force, say two experts at the US-based Society for Human Resource Management (SHRM). Senior government affairs policy counsel Nicky Hammer describes “an unprecedented challenge of long-term unemployment”, with over 4m Americans out of work for over six months. In a country where ‘unemployed need not apply’ appears frequently on job ads, SHRM is championing the value of diverse talent pools. Mark Schmit, executive director at the SHRM Foundation, SHRM’s separate research body, says an ageing workforce poses “a substantial problem — the loss of knowledge and experience”. He continues: “Business leaders are growing increasingly concerned about how they will replace these existing workers, especially those with high indemand skills and education.” John Wilson, chief executive officer of recruitment process outsourcer (RPO) WilsonHCG, adds: “The talent pools are tightening, and you’re seeing a focus really going back on the RPO side for being recruiters first and process handlers second.”
An IBIS World report in September projects total 2013 revenue in the US permanent recruitment agency market to be $16bn (£9.8bn), down 1.5% since the start of the recession in 2008. For temporary staffing, revenue should total $95.8bn, down just 0.1% in the same period. The state of California is the biggest in terms of revenues generated for both perm and temp recruitment. By comparison, the REC’s Trends survey for 2012-13 shows the UK perm market is worth £2.4bn (down 42% on 2007-08) and temp revenues £24.1bn (up 5.9%) A Bullhorn survey in 2011 found the US has 65 recruitment professionals per 100,000 population, half as many as the UK with 129.
Sponsored by SAM BURNE JAMES sam.burnejames@recruiter.co.uk
AMERICAN STAFFING ASSOCIATION’S STAFFING INDEX 105
100
This is key, given what he calls the “vast difference” in RPO either side of the pond. WilsonHCG has US clients where they recruit 99.8% of roles direct, while “in the UK, many RPO firms are more a managed process offering,” he notes. Another key when operating in the market, Wilson says, is “a lot of regulation on the diversity and fairness of recruitment”, in particular the “very confusing” OFCCP laws, which apply to those wanting to work with Federal government. Adrian Kinnersley, founder of London-based Twenty Recruitment, which opened in New York in 2011, illustrates a further bureaucratic difficulty. Placing contractors in different states, “you have to technically be set up to payroll and operate in that [individual] state”, or else supply through a third party, he says. Challenging, but surmountable. With only one office in the country, Twenty can supply into 49 different states. Choosing a location for a physical base is key in such a huge country. Tech and telco specialist ConSol Partners, another UK-based recruiter, chose a less obvious one: Santa Monica, California. Before relocating to California early this month, founder Marc Cohen told Recruiter: “New York might seem to beckon, but it is a stifling environment for tech start-ups as they compete with financial giants for talent and investment.” ConSol illustrates that while New York might be ‘a helluva town’, there’s a helluva a lot more out there — lest we forget, the US is still by far the world’s biggest economy, with GDP twice the size of China.
Key indicators
JOB OPENINGS In September 2013 the Bureau of Labor Statistics recorded 3.91m job openings in the US, up from 3.84m in August, and from 3.6m in September 2012. The top five industries for vacancies in September 2013 were: Professional and business services
95
Healthcare and social assistance
90
Financial & administrative support as affirmed by our award-winning clients
Retail
01 260 280 290
Accommodation and food servs
85 Jan 1
No. 1 Quality
Apr 14
Jul 27 Weeks in 2013
WWW.RECRUITER.CO.UK
17_Recruit_dec13_Global spotlight.indd 17
Oct 40
www.backofficesupportservices.co.uk
State and local gov't
46
0
100
200
300
400 ’000
500
600
700
800
RECRUITER
DECEMBER 2013
17
05/12/2013 15:50