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RECRUITER HOT 100 COMPANIES 2015
People power brings profits What’s so hot about Recruiter’s HOT 100? Profitability equals productivity in the highly competitive world of recruitment, and our HOT 100 companies effectively execute the perfect blend of money-making ability with efficiency. It’s the dream pairing for business success. Yes, turnover is certainly important. But that’s not the end of the story. It’s what you do with it, and how you use it and manage it that really counts. This is the 10th edition of the Recruiter HOT 100. In this year’s edition, we see a previous top-place holder regain their No 1 ranking. We also see from other companies’ rankings that success here in the top echelon is generally not a ‘flash in the pan’ but a reflection of longterm financial and headcount management. Companies shown here as earning success demonstrate that recruitment is a truly professional service. Congratulations to our HOT 100 companies. We are delighted to continue to work with the brilliant Agile Intelligence on this project, and we thank our headline sponsor Interact Medical for supporting us this year.
↗
↗ DEEDEE DOKE Editor, Recruiter recruiter.co.uk
Recognising achievement
RICHARD MOSES Business development director, Interact Medical
Achieving recognition as one of Recruiter’s HOT 100 companies for the second year in succession is a massive source of pride for Interact Medical. 2015 has been a challenging year in terms of NHS budget scrutiny, particularly in terms of spiralling temporary staffing expenditure following the outcomes of the Francis Report. Interact has worked closely with its customers to ensure the needs of the NHS are reflected as closely as possible within the service delivered through its Framework Agreement awards. Next year continues to look full of opportunity and our recruitment expansion reflects this. Interact are working on a number of exciting new technology offerings which will benefit both our clients and candidates. Our aim is to make the entire booking process more accessible, efficient and innovative. The HOT 100 is a great opportunity for us to showcase the extensive achievements Interact have enjoyed throughout 2015 and we look forward to continued success in 2016!
Interact Medical is a specialist National Framework supplier of locum doctors, nurses and allied health professionals. For further information, visit www.interactmedical.co.uk Tel 01908 357900 Email info@interactmedical.co.uk
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RECRUITER HOT 100 COMPANIES 2015
The conďŹ dence that recruiters have been displaying in the UK economy is now being rewarded, as shown in the 10th set of results for the HOT 100 companies. Sue Dodd, director of Agile Intelligence, reports COMPILED BY
4 RECRUITER HOT 100 2015
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RECRUITER HOT 100 COMPANIES 2015
T
GP/head entry threshold reached £92,632 – a full 8.2% above last year’s HOT 100 companies that pace of expansion in staff, so the ratio of the two rose just slightly. There have been acquisitions too, leading to some exits from the list, mainly from companies following a strategic thrust to strengthen or broaden their specialist divisions and increase their value proposition. Myriad smaller deals took place, but some of the larger ones that stand out from the crowd are Lorien to Impellam, Networkers to Matchtech, and both Sugarman and, latterly, Staffgroup to Cordant. That increasing dominance of specialist recruiters in the HOT 100 has clearly been noticed. As business models alter, some big names have also dropped out, often
15% Average UK recruitment industry sales value rose by more than 15% in 2014
O
seeing increased managed services or project-based operations, which affect the GP/head. Robert Walters, SThree, Hays and Impellam are all below the threshold now, and this shift reduces the total sales revenue of the HOT 100, its GP and its internal employee count. However, it does not deter from the analysis, since these companies, along with many hundred others, have all been assessed. The calendar year 2014 proved to be a period of selective recovery on average across the whole UK recruitment industry, with its sales value rising by more than 15%, according to the Office of National Statistics, after including all those
↗
he Recruiter HOT 100, now in its 10th year, has stood the test of time with its methodical research and analysis. It has described leading trends and signalled future ones by examining in some detail the collective and individual position of these, the most productive recruitment companies in the UK. In particular, one key performance indicator, gross profit per head (GP/ head), encompasses so much about how a company operates — its effectiveness at extracting the best performance from its own people, in a sustainable manner. Long-term membership of the HOT 100, therefore, is a strong indicator that a company is doing a lot of things right. A look back at that first report shows us that 26 of those original HOT 100 companies are still recognisable in today’s report, either in their own name or as part of merged organisations. Many more remain within the closely pursuing pack, still striving to optimise productivity. Together, all these companies represent the success story that is the UK recruitment industry. Often they are the benchmarks for quality processes and people-centred strategies that incorporate all the stakeholders in the employment arena. Yet, each year, the bar just keeps moving higher. This year surpassed all predictions as the GP/head entry threshold for this particular HOT 100 reached £92,632 — a full 8.2% or £7k above last year’s group of HOT 100 companies. Nevertheless, the average productivity growth of the HOT 100 was muted this year, because employee numbers were expanded so substantially in another vote of confidence by their management in the UK economy and its related labour market. Total gross profit (GP), as a result, only just kept ahead of
Methodology The data has been rigorously filtered by turnover, gross profit and employee numbers; details are available on request. The companies featured in this edition employ almost 18,000 inhouse staff and generate £9.6bn of industry sales revenue. All the companies evaluated as part of the overall analysis accounted for well over double these sales and employee numbers. Latest available accounts have been used — dated 2014 or 2015 for all companies — but a few companies are excluded due to filing timings. Companies filing abbreviated accounts and not providing their
full figures separately are also excluded. Increasingly, with the internationalisation of many UK recruitment firms, the geographical profile is evolving from pure-play UK operations; group accounts are now used for UK corporations where these prove more up-to-date — examples would be Harvey Nash, Robert Walters, PageGroup and several IT recruiters. Primarily overseas operators have been excluded, although UK engineering specialists placing talent worldwide are included. Overseas-based groups, such as Adecco, Randstad or Hudson, may be
included, using only their UK operating companies. Two prominent exclusions from the analysis are Manpower and Reed, because of accounting differences that invalidate comparisons. Furthermore, companies combining temp employees in their employee count are not included, as this grossly underestimates their performance. Small search specialists and ‘head-hunters’ with almost entirely global interests are omitted for a variety of reasons — incomplete disclosure, overseas business and a shortage of data for peer group comparison.
DISCLAIMER: while every effort has been made to ensure accurate reporting and analysis, no guarantees are made regarding the information in this document.
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RECRUITER HOT 100 COMPANIES 2015
Public sector fared even better than professionals, with its HOT 10 adding more than 20% in net fees ↗
49%
O
saw growth combination in employees and productivity
51% reported an actual rise in gross margin
O
attributed mainly to a change in the business mix. As mentioned, gross margin, aggregated across the whole of the HOT 100, actually increased for only the second time in 10 years. There is little evidence that temp pricing has suddenly recovered, but the pattern of gross margin across the HOT 100 does indicate a varying business mix. Of the 2015 HOT 100, 26 companies earn gross margin below 15%, versus 27 last year. However, winners and losers were evenly matched, as 51% of the HOT 100 reported an actual rise in gross margin. There is clear evidence of a migration in margin towards the 20-30% band, mainly owing to highermargin companies moving down the scale — almost certainly a reflection of some higher contract business mix and/or permanent fees pressure. Conversely, more companies are
G ROS S MARG IN & G P Gross margin is the GP (or net fees) as a percentage of sales turnover. GP is a combination of permanent fees — at virtually 100% margin — plus the profit on temp supply after subtracting payroll and other ‘temp’ employment costs. The mix
↗
additional employer costs, increased managed services and pay rate inflation. The 2015 HOT 100 spans sales growth ranging from almost 100% to a decline of 19%, but such growth rates can easily be distorted by acquisitions, disposals or the perm/temp mix. Sector performances were better spread during the year under review, as the public and professional sectors recovered significantly. That year saw a comeback from professional specialists, with the HOT 10 professional recruiters gaining a substantial 18%, but last year's star performing technical recruiters added ‘only’ 8.3% to their HOT 10 net fees, as several companies were hit by the late 2014 slowdown in the oil & gas industry. Public sector fared even better than professionals, with its HOT 10 adding more than 20% in net fees, driven by strong performances from frontline staff suppliers but also by executive-level demand. IT continued its solid gains, adding more than 15% from its HOT 10 performers. On aggregate, the 2015 HOT 100 saw overall solid growth — in the 2014 or 2015 reporting year-end it represents — as 77 companies posted a rise in net fees. The average size of the 2015 HOT 100 member dropped sharply to 178 employees, as some of the largest players did not make the cut, but around two-thirds of constituents still oversaw some net organic expansion of their internal workforce. The long-term gross margin decline was finally reversed — a shift that was seen equally both inside and outside the HOT 100,
operating with margin above 50%, a sign of high permanent business mix. Yet within this range, there was some downward shift, due to an increasing presence of permanent specialists in the interim management market. The dream growth combination, in both employees and productivity, was achieved by 49% (35%) of constituents — displaying a broad spread of gains across sectors. This spread indicates, it seems, the increasingly wide-ranging economic recovery under way during the period. As the UK economy broadened its recovery, so too did the underlying demand for recruitment services. Note that the uncertainties associated with much of 2015 — the May general election, oil price weakness, and global economic and geopolitical issues — would have had limited impact on this HOT 100 because of the accounting periods involved.
Agile Intelligence Agile Intelligence has compiled the HOT 100 report on behalf of Recruiter to determine which companies are best at leveraging their intellectual assets. Rigorously measuring the GP (net fees) per employee indicates how effectively an organisation uses the skills of all its own people to generate a profitable return for stakeholders. All in-house employees, excluding temp workers or
contractors, are included in the calculation, not just feeearners — this is a standard senior management KPI. Notwithstanding wild cards, companies emerging strongly from this analysis, especially if featuring regularly, are primarily those that operate the most productive organisation, balancing the need for good, well-trained, directed and motivated staff against the need to minimise costs. Which companies
derive most ‘added value’ from their own employees — before allocating overheads — yet still engender the right atmosphere over the long term to encourage a profitable and sustainable sales approach? The answers are in the 2015 HOT 100.
6 RECRUITER HOT 100 2015
2015 Hot 100 v2 REVISED.indd 6
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Gross pro latest ye fit ar (£m) Gross pro previous fit year (£m) Sector coverage
1
P
178,670
158,707
Sheffield Haworth
20.2
16.7
Financial services: executive search, interims, HR solutions
2
–
171,312
169,162
Shilton Sharpe Quarry
16.1
13.5
Legal
3
N
170,682
157,727
TRS Staffing Solutions
4
▼
161,753
174,162
Vector Resourcing Holdings
Fluor Corporation
3.8
3.5
Engineering/technical into oil & gas, rail & transport, construction
5.3
5.6
Technology
5
–
160,616
148,769
Interact Medical
6.9
5.8
Locum doctors including niche technical skills
6
▲
158,431
128,311
NRL
12.0
9.5
Technical, construction, oil & gas, petroleum & energy
7
▲
152,518
133,127
SystemsAccountants
5.5
4.1
Finance systems, finance transformation, EPM, BI, ERP
8
▼
149,974
148,396
Odgers (Group)
69.7
60.0
Executive search, interim managers
9
▲
149,614
136,112
LA International Computer Consultants
14.8
13.3
IT
10
▼
148,628
140,180
Mayday Healthcare
21.1
17.0
Healthcare
11
–
146,874
138,078
Penta Consulting
12.9
12.2
Telecoms, IT
12
▼
145,462
141,725
Morgan Law Partners
7.3
5.5
Executive finance, HR, PR, procurement, ops, IT into public and not-for-profit
13
▲
140,458
130,021
Walker Hamill
6.7
6.1
Accountancy & finance, debt & structured finance, private equity, M&A
14
▼
140,091
150,285
NES Global Talent
82.4
77.2
Technical/engineering into oil & gas, power, chemical, life sciences, rail
15
▼
136,780
136,928
GatenbySanderson
11.9
8.9
Executives in health, education, government, not-for-profit
16
▼
134,452
134,805
WA Consultants
3.8
4.0
Technology/IT
17
▲
134,249
127,248
Interim Partners
4.4
4.1
Interim executives
18
▲
132,532
111,507
People Source Consulting
5.7
4.6
Technology/IT
19
▲
132,457
120,908
The SR Group Holding Company
27.3
22.4
Legal, compliance, HR, marketing, tax, treasury, executive search
20
N
130,301
123,762
Euroforce People Solutions
2.6
1.7
Skilled staff into furniture, textile, automotive manufacturing
21
▲
127,255
112,133
Caritas Recruitment
6.5
5.0
Social care into public, voluntary and private sectors
22
▲
126,847
98,177
Kin-Tec Holdings
7.0
5.6
Technical (engineers) & geoscientists into oil & gas, built environment, rail
23
–
126,228
120,750
High Finance (UK)
4.7
4.8
Actuarial, risk, audit, compliance, IT, strategy, claims, broking, underwriting
New Street Group
nGAGE Specialist Recruitment
N
126,040
127,003
The Bridge (IT Recruitment)
2.8
2.8
IT & energy
25
▲
125,010
102,006
CMA Financial Recruitment
3.9
3.3
Accounting & finance, executive, HR
26
▼
124,746
119,536
Opus Recruitment Solutions
6.5
3.3
IT/telecoms, banking & financial services, public, energy
27
N
124,504
112,693
Elite Associates Europe
4.4
3.5
Retail: senior, operations, tech/design, digital/marketing, temp sales staff
28
▼
123,511
115,793
Investigo
18.3
15.7
Accountancy, finance, property, procurement, HR, compliance, risk, SAP
29
N
122,349
109,921
Community Resourcing
10.2
6.9
Facilities management, construction, surveying & property, justice & abuse
30
N
121,652
115,926
McGinley Support Services (Infrastructure)
16.1
15.7
Construction/infrastructure
31
▼
120,611
138,847
Green Park Interim & Executive
4.2
5.1
Interim management, executive search into public & private
32
▼
120,513
138,638
Swift Worldwide Resources Holdco
49.8
52.4
Oil & gas/energy
33
▲
119,910
86,039
CPS Group (UK)
2.7
1.8
IT, engineering, procurement, ERP
34
▲
119,099
108,139
Rullion IT Plus
8.9
8.8
IT/telecoms/business change & transformation
35
▲
116,985
116,383
Fircroft Engineering Services
68.1
59.6
Technical/engineering into oil & gas, industrial, commercial
36
▲
116,857
97,643
Randstad CPE
26.9
21.9
Construction, property, engineering
37
▲
116,806
102,847
Resource Solutions Group
22.3
18.1
IT, business change, finance, government
38
▲
116,766
109,603
CBSbutler
6.5
6.6
Engineering, manufacturing, technology, life sciences, business support
39
▲
116,743
97,950
William Alexander Recruitment
2.3
2.0
IT & business change
40
▼
116,535
154,241
Montash
4.2
3.7
IT: BI, data & analytics, security, ERP, CRM, scientific technologies
41
▲
116,044
89,067
Options Resourcing
4.6
4.0
Construction, mechanical & electrical, facilities management
42
▲
115,719
102,606
Coyle Personnel
14.9
12.0
Technical, construction, medical, infrastucture, public, commercial, industrial
43
▼
114,841
120,234
Eames Consulting Group
7.0
6.5
Actuarial, audit, broking & underwriting, claims, compliance, risk, technology
44
▼
114,477
121,587
G2V Recruitment Group
12.9
12.2
IT, engineering, oil & gas
45
▼
113,363
110,842
Staffgroup
13.4
11.0
Technology, oil & gas, engineering (hi-tech), finance
46
▼
113,000
116,579
Roevin Management Services
4.0
4.4
Engineering
47
▲
112,429
103,653
RIG Locums
3.5
2.3
Locums for surgery, medicine, women & children, A & E
48
▲
111,943
98,641
Randstad Care
7.8
7.8
Social care, nursing, allied health professionals
49
N
111,844
135,586
Petroplan Holdings
11.7
13.4
Oil & gas, energy
110,808
99,610
Aspire Global Network
8.6
8.4
Media & marketing communications: digital, graduates, content & editorial
50 Key:
▲ ▲
Up
▼
Down
– Unchanged
N New
nGAGE Specialist Recruitment
Randstad Holding NV
Adecco SA
Randstad Holding NV
** Pro rata 12/15
24
formerly Human Capital Investment Group (HCIG)
Parent g (where droup if ferent name)
Gross pro employeefit per latest ye ar (£) Gross pro per emplofit previous yee year (£) Company/ trading n ame
Rank
Change
RECRUITER HOT 100 COMPANIES 2015
P Previous entrant WWW.RECRUITER.CO.UK 7
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Parent g (where droup if ferent name)
Gross pro latest ye fit ar (£m) Gross pro previous fit year (£m) Sector coverage 4.9
3.4
nGAGE Specialist Recruitment
14.1
12.7
Built environment, public
3.9
3.9
Oil & gas, engineering, accountancy, office support, HR, IT, S&M, supply chain
17.8
17.2
Education
3.8
3.5
Marketing, creative and media communication: digital & integrated
4.4
4.7
IT, telecoms
51
N
110,353
94,513
Oakleaf Partnership
52
▼
110,250
103,934
Eden Brown
53
▼
110,163
108,313
Aberdeen Appointments Agency
54
▼
109,877
108,785
Randstad Education
55
▼
109,540
104,162
Source Personnel
56
▲
108,220
94,380
Randstad Technologies
57
▼
108,023
100,310
Badenoch & Clark
32.8
29.8
Finance, accountancy, banking, legal, IT, HR & marketing
58
▼
107,064
117,440
Black Swan Associates
3.0
2.9
Compliance, risk, finance, change management, audit, ops, S&M
59
▼
106,224
100,802
Red Commerce
16.1
16.8
IT
60
▲
106,149
94,951
The Rethink Group
20.0
19.6
Business/technology, energy, life sciences/pharma, engineering, commercial
61
▼
105,973
110,837
Matchtech Group
55.0
45.0
Engineering, IT, professional, education
62
▲
105,585
84,271
Orion Electrotech
5.3
4.4
Technical: aerospace, construction, gas
63
▲
105,570
97,702
La Fosse Associates
7.3
6.4
IT, technology, digital at all levels including executive search
64
▼
105,543
101,777
Oil Consultants
6.3
4.9
Oil & gas, niche technical skills
65
▼
105,500
99,732
Shorterm Group
10.3
8.2
Engineering, including aerospace, automotive, construction, oil & gas, logistics
66
▲
105,372
97,700
Rullion Engineering
8.0
7.0
Engineering/technical, including oil & gas, energy & power, rail, manufacturing
67
N
104,657
91,764
Hallam Medical
3.6
2.0
Primary care & community nursing
68
N
104,542
101,758
Contract Scotland
3.1
2.8
Technical/professionals into construction & engineering
69
N
104,265
85,417
Goodman Masson
12.7
10.1
Finance, accountancy, banking, actuarial, compliance,tax, public, audit
70
▼
103,592
98,685
Capita Resourcing
40.6
35.0
Education, social care, IT, medical, energy & utilities, interims, professionals
71
▼
103,418
108,808
Harvey Nash Group
89.5
88.6
IT, finance, interims, executive search
72
▼
103,418
102,381
Next Ventures
7.2
6.5
SAP, digital, Oracle
73
N
103,167
103,885
First Technical Recruitment
6.6
7.3
Technical into chemical, water, oil & gas, pharma, power, mining, FMCG
74
▲
103,149
91,763
Redrock Consulting
4.7
4.5
IT & telecoms
75
▲
102,681
81,378
Phaidon International
21.7
13.8
Financial services, professional services, energy, STEM
76
N
102,567
83,705
Digby Morgan Consulting
77
N
102,320
79,203
ROC Search
78
▼
101,373
95,759
PSR
3.9
2.8
Construction: building, civil engineering, residential
79
▼
100,263
105,571
Portland Resourcing
3.4
3.2
IT: SAP
80
▼
99,144
97,815
Henderson Scott
3.5
3.1
Technology infrastructure, cloud computing, ERP & enterprise software
81
▼
98,615
101,813
Modis International
10.3
9.8
IT, including development, SAP, infrastructure, BI, aerospace & engineering
82
▼
98,591
104,555
Oliver James Associates
15.8
12.2
Actuarial, audit, finance, marketing, technology, legal, underwriting, broking
83
▼
98,415
101,497
Michael Page International
532.8 513.9
Accountancy, finance, legal, engineering, IT, retail, energy, HR, construction
84
▼
98,067
97,265
PSD Group
23.4
Executives and management: including accountancy, engineering, hospitality
85
▼
97,840
107,735
Air Energi Group
43.4
43.5
Oil & gas/energy
86
▼
97,767
99,081
GCS Recruitment Specialists
7.2
7.5
Technology & financial services (risk & compliance)
87
N
97,570
99,143
Indigo/ICS Group (pro rated)
88
▼
97,062
91,689
IPS Group
89
N
96,904
80,779
Synarbor
9.1
7.7
Education, social care, healthcare
90
N
96,439
84,813
Cornwallis Elt
3.1
2.7
Technology/operations: banking, fund management, insurance, digital & media
91
▼
96,200
71,607
Gemini People
3.4
2.0
Advertising, digital, NGOs, fashion & media
92
▼
96,172
114,589
Purple Consultancy
2.1
2.5
Design, integrated & production
93
N
95,472
81,102
Cognitive Group
2.0
1.0
Microsoft partner, professional, retail, manufacturing, media, finance, charity
94
N
94,469
87,756
Venturi
2.4
1.8
IT, including BI, data warehousing, development, infrastructure & support
95
N
93,942
82,028
IDPP Holdings
2.8
3.0
IT, telecoms, executive, technical sales, interim
96
▼
93,795
88,108
Cavey Dale Group (CD Sales Recruitment)
3.8
3.3
IT sales, IT technical staff
97
▼
93,743
113,065
Ajilon (UK)
Adecco SA
14.2
17.3
IT, other professional sectors
98
N
93,736
116,971
Finegreen Associates
Accountants in Demand
1.9
2.6
Health: executive, non-executive, senior management, management
99
▼
93,139
88,300
Randstad Financial & Professional
Randstad Holding NV
10.1
10.7
Finance, accounting, legal, interims
100
▼
92,632
104,851
PPF
9.4
10.5
Drivers
Key:
▲
Up
▼
Down
– Unchanged
N New
Randstad Holding NV
Adecco SA
Capita
Randstad Holding NV
Adecco SA
Indigo Parent
Human resources
3.1
3.1
HR
5.9
4.0
IT, engineering
23.8
118.5
84.0
Healthcare, social care, life sciences
6.1
5.6
Underwriting, risk, insurance, broking
formerly Human Capital Investment Group (HCIG)
Gross pro employeefit per latest ye ar (£) Gross pro per emplofit previous yee year (£) Company/ trading n ame
Rank
Change
RECRUITER HOT 100 COMPANIES 2015
P Previous entrant
8 RECRUITER HOT 100 2015
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RECRUITER HOT 100 COMPANIES 2015
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73%
O
increased GP per head
9.7%
O
Overall headcount gained
O 20.4 %
Average gross margin rose 40 basis points
are regarded as permanent specialists. There is clear evidence now of a strategic expansion into the interims market, bringing the average margin lower. ● The permanent market began to recover during 2014, albeit alongside some growth also in the temp market. However, sector discrepancy is still seen — with some specialisations seeing growth but not across the board. ● The most represented group remains those companies with margin between 20% and 30% — substantial temp with also a high portion of permanent fees (quite possibly 50/50 in this range) or specialist temp in a higher-margin niche. There is less evidence this year of temp margin erosion, but
this can be difficult to pin down from annual returns. ● Biggest losers: the 30-40% margin band saw a loss from 13 down to just 11 constituents, as companies dropped into the lower band. ● Most gains: the 20-30% margin band gained the most, for reasons provided above. ● 26 agencies now achieve gross margin of less than 15%, with still 11 of these below 10%.
KE Y FIN D I N G S 2015 HOT 100 group sales turnover rose 8.3%, below the whole recruitment industry sales turnover growth of 15.4% reported for calendar year 2014 by the Office of National Statistics. This HOT 100 accounts for around 25% of ‘real’ industry sales
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of business between temp and permanent placements influences the level of gross margin, as does the trend in temp pricing and employment-related costs. With larger contract business notoriously competitive compared with SME or ad hoc placements, the type of business and delivery model/cost structure play a crucial part both in determining temp margin and also bottom-line profitability. The chart (below) shows the gross margin breakdown by accounting year. The main gross margin findings were: ● The margin distribution of 2015 HOT 100 versus previous issues: there was a clear shift from high-end margin players (driven more by perm) towards middlemargin players (15-30%), which consequently gained ground. Bottom-end margin suppliers (<15%) also dropped slightly, as some lowmargin companies failed to make the entry threshold this year. ● 3% of the HOT 100 are almost exclusively permanent recruiters, but probably about nine companies
This HOT 100 group added £183m in net fees in the past year
H O T 1 0 0 C O M P A N I E S B Y G R O S S M A R G I N B A N D (in accounting year)
30 2007 2008
25
2009 2010
20
2011 2012 15
2013 2014
Source: Company accounts
10
5
0 less than 10%
10% to 15%
15% to 20%
20% to 30%
30% to 40%
40% to 50%
more than 50%
Gross market band range
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Sponsored Q&A
INSIDE INTERACT MEDICAL We speak to Interact Medical to understand how they continue to deliver market leading supply in accordance with increased compliance and regulatory requirements. Following proposals made by the Department of Health earlier this year, how have Interact Medical improved their delivery of safe candidates to the NHS? Richard Moses Business Development Director Interact have always placed compliance at the forefront of all its business activities. The hard work delivered by the company has routinely been recognised by each of the Framework providers with Platinum audit outcomes being consistently achieved. 2015 has seen the further development of our Appraisal and Revalidation service which is now into its third year of operation. We regularly host revalidation seminars at our headquarters in Milton Keynes with over 250 doctors in attendance. During these seminars, doctors receive training in all mandatory requirements, have the opportunity to receive annual appraisals in readiness for GMC Revalidation and receive assistance in the development of their Multi Source Feedback portfolios. Furthermore, our Skills for Health trainers deliver CPD accredited courses which complement the core requirements of mandatory training.
What commitment in terms of staff do you have to deliver this level of service? Charlene Meikle Compliance Manager With over 500 prescribed connections and routinely receiving over 20 new candidate applications per week, the team has grown significantly over the past 12 months. Of our 110 staff, over 25% now work solely within compliance and revalidation. Our revalidation team, led by Jennifer Paine and strongly supported by Claire Wright, have worked expertly to achieve an unprecedented revalidation appraisal success rate of 81% over the past 10 months for our
doctors. The investment within the team has allowed us to mentor our doctors more closely ensuring that their Multi Source Feedback is appropriate and reflective of the needs contained within the revalidation process. Looking forward to 2016 and our ambitions to further expand our supply capability within nursing, the team will expand further as will their technical capability ensuring that we continue to deliver safe and compliant framework supply.
Doctors’ feedback tells us that these events are an essential component of their career development and feel the quality and depth of service delivered by Interact Medical is the best they have experienced in the industry. This approach has enabled us to take the core compliance components directly to the doctor. We often arrange to see doctors after work or at a time more convenient to them.
What services do your compliance team offer? Sam Gleave Quality Assurance Manager The compliance team at Interact Medical recognise the value in doctors being able to complete their application process in a mobile environment. As a result Interact Medical have a highly efficient mobile compliance team.
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Over 50% of my team are qualified phlebotomists which mean a full suite of serology tests can be taken at the same time training, interview and validation of documents takes place. We have also recently extended our Skills for Health training to include Automated External Defibrillation. This has been an exciting opportunity for my team to extend their technical knowledge and further enhance the service they deliver to our doctors.
What challenges do you face when recruiting for staff to support Interact’s planned expansion? Lizzie Eglesfield HR Executive Since joining Interact earlier this year I have been heavily involved with the recruitment of exceptional candidates who have gone on to share the core philosophy and values Interact have become synonymous with. My immediate challenges include recruiting over 40 new members of staff to support our further growth into new and existing markets. Our staff retention rates are significantly above market average which I believe is a reflection of our ability to recruit the right people into the right roles. The company has been very successful in reacting to a changing market place and this is something we are now capitalising on where other companies are choosing to reduce or cease active recruitment.
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making a difference. As an award winning specialist medical recruitment agency, Interact Medical recruits outstanding talent for the NHS. If you’re looking for the very best locum doctors, nurses or therapists for your Trust, we have the highest calibre candidates to offer. If you’re a medical locum, nurse or therapist considering your next opportunity, we have a diverse range of assignments waiting to be fulfilled. If you’re a recruiter at the top of your game and are looking for your next move, we’re an industry leading agency waiting to hear from you.
+44 (0)1908 357900 info@interactmedical.co.uk www.interactmedical.co.uk
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RECRUITER HOT 100 COMPANIES 2015
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turnover, estimated from official data by Agile Intelligence. Likefor-like, comparing this group against their own figures for the previous year, headcount expansion accelerated sharply. Overall headcount gained 9.7%, and this translated into a fairly commensurate 10.4% rise in GP, with productivity gains constrained by the less productive newer fee-earners. Hence, GP/head increased only marginally, by 0.6%. Gross margin, however, saw its first rise in several years. Like for like: ● The 2015 HOT 100 companies collectively reported an increase from their previous year in latest available sales of 8.3% to around £9.6bn. ● HOT 100 companies’ combined GP reached almost £2bn, a gain of 10.4% versus their prior year.
3 O 3 %
are almost exclusively permanent recruiters
14% of HOT 100 companies employ more than 200 staff
O
● HOT 100 companies’ in-house headcount rose 9.7% to total 17,812 employees. ● Productivity (GP per employee) for this group of HOT 100 companies rose by 0.6% over the year to an average £109,448; this also stands a massive 9.6% above last year’s HOT 100 group average of £99,853. ● HOT 100 average gross margin rose 40 basis points for these companies to 20.4%, with an overall shift in the business mix towards permanent fees. ● This HOT 100 group in the past year added £183m in net fees, with an additional 1,582 staff at an incremental gross margin of 24.8%, making an incremental £116,000 additional GP/head. This is a far better performance than we reported last year, when the incremental margin was just 10.5%,
and indicates a better mix of ‘new’ business — either better-margin temp or permanent fees. However, the expansion in staff numbers means that the incremental GP per head, while solid, was below that for last year, as newer fee-earners cancelled out the benefits of maturing consultants. ● Entry level (ranked 100) to the 2015 HOT 100 was £92,632 in GP/head, a record £7k ahead of the prior-year threshold for the cut. cross all HOT 100 companies 67% expanded their workforce either organically or by acquisition, compared with 66% previously; consistently now, around two-thirds of organisations are choosing to grow headcount. A substantial 73% increased GP/
A
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RECRUITER HOT 100 COMPANIES 2015
head, 13 more than last year’s 60%. Productivity gains, therefore, were more widespread, but the size of the gain, like-for-like for this group of companies, was far less than that in the prior year. The dream combination of expanding workforce and rising productivity was achieved by 49% of the 2015 HOT 100, versus just 35% last year and only 23% the previous year. These 49 companies were apportioned equally between larger and smaller firms, unlike in past years when smaller firms took the lion’s share. The breakdown was as follows: ● 19 (48%) of the 40 firms with less than 50 employees ● 30 (50%) of the 60 firms employing above 50 employees.
CO M PANY TRE N DS: PRO DUC TIVIT Y G ROW TH SO LID ACROS S ALL SEC TO RS WITH IT AN D PRO FE S S I O NAL S LE AD ING
unavoidable initial cutbacks in people made during the economic downturn. Companies have entered the upturn leaner, but a shortage of suitable experienced candidates may have forced a cautious hiring attitude, the need to bring in inexperienced staff, and a rise in in-house training. While the latter might delay the benefits of immediate hires, the long-term impact could just be delivering a more sustainable growth for companies. However, a few driver and skilledtrade specialists apart, the average placement value of the more general recruiters, be it office or industrial, is now much lower than the high charge rates of specialist candidates. So their re-entry into the HOT 100 based upon GP/head would be difficult. If conversion rate from net fees to bottom-line contribution were measured instead, then their process efficiencies would, no doubt, allow them to excel compared across all specialisations. n the Top 20, six professionals are listed, half of which are in the Top 10. Seven IT staffing companies are listed in the Top 20, of which three are also in the Top 10 while the Top 20 balance again comprises four public sector firms — two executive and two healthcare providers — and again three technical recruiters and one blue-collar skills. The Top 10 comprise a varied mix of specialised recruiters. Financial services specialist Sheffield Haworth has returned to top spot several years after the impact of the global financial crisis. Even in this
I
15%*
O
are from the professional sector
10%*
O O
the technical sector
10%* the public sector
13%*
1 O 1
O
the IT sector
%*
blue-collar skills specialist percentages relate to the 49 companies to achieve both headcount and productivity growth
accounting year, GP remains below 2010 levels, but recovery is well on track. Legal recruiter SSQ came a close second, as both firms grew staff numbers and saw strong net fee growth. Both reported higher GP/head than the prior year. Third is TRS Staffing Solutions, a small, new entrant engineering specialist, albeit with the advantage of an EPC [engineering, procurement, construction] parent owner. Vector Resourcing drops to fourth place, just ahead of Interact Medical. Following the tail-off in oil & gas market activity towards the year end, multi-national contractor NES Global Talent has dropped out of the Top 10, alongside its engineering/technical sector rival, Swift. Less energydependent technical recruiters, such as the aforementioned TRS and NRL, have quickly moved into the empty space. The Top 10 profile still resists the presence of any ‘broad spread major multi-sector recruiters’. Sheffield Haworth, SSQ and Odgers are predominantly permanent recruiters. TRS, Interact Medical, NRL and LA International are all mainly contractor-based models, with the others offering a mix of both permanent and temp business. Among the large corporate groups in the HOT 100 where it makes sense to separate out the UK subsidiaries, these have been listed individually — Randstad and Adecco again have five and four respectively. The nGAGE Specialist Recruitment ‘stable’ has three companies in this year’s HOT 100, plus additional ‘interests’. Overall, just 14% of HOT 100
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The bar for HOT 100 success this year rocketed to more than £92,600 GP/head — beyond all expectations. There was also a sharp rise to 73% of the proportion of constituents seeing a gain in productivity (GP/head), while 49% of companies achieved both headcount and productivity growth, versus just 35% last year. These 49 companies now show a much more representative spread across the key sector groups than has been seen for several years. This year reported professional (15), technical (10), public sector (10) and IT (13), with the remaining company being a bluecollar skills specialist. Gains have been made in every sector, but especially in IT (only six last year) and professional (previously 10), while public sector again showed further recovery. A threshold of £92,632 is 8.2% higher than last year’s minimum threshold. This suggests not only a sizeable movement up the value chain in the recruitment industry but also strong progress in productivity levels, perhaps kick-started by the
Companies have entered the upturn leaner, but a shortage of experienced candidates may have forced a cautious hiring attitude
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companies employ more than 200 staff, compared with 13% last year, and those employing 100-199 staff are also fairly stable, at 20 constituents. A rise was seen in the smallest firms, with 11% employing between 20 and 30 staff versus 9% last year. The 30-49 staff band also increased again to 29% (26%), but there was a marked decline to 26% (31%) in the employee band 50100, suggesting that it is the smallto-smaller end of medium-sized, maturing companies that is presently out-performing the pack.
O FFI CE /IN DUSTRIAL STAFFING The ‘high street’ national recruiter has finally disappeared from the HOT 100. It is hard to see a comeback, as its emphasis has changed towards different delivery models and bottomline profitability rather than net fees generated through high gross margin. As the temp margin eroded, with office and industrial volume staffing contracts driving prices downwards,
this trend was compounded by the low average-placement value. Thus, producing high GP/head, has neither been realistic nor a priority. Only PPF, the driver specialist, survives in the HOT 100 this year, and it is ranked 100th compared with 45th last year. There were two general recruiters listed last year and four the prior year. Ten years ago, the HOT 100 included 15 ‘generalists’ offering either office or industrial staffing services. In mitigation, there are a few companies supplying skilled trades into various industry sectors, usually as part of a mix with technical professionals. One such newcomer is Euroforce, specialising in skills for furniture, textile and automotive manufacturers, sourced from across Europe. PPF, trading as ADR Network, remained in the HOT 100 despite a reduction in sales and GP as some lower-margin business was intentionally shed, driving up margin, while driver CPC training lost some hours, and the
11%
O
employ 20–30 staff
14%
O
employ more than 200
29% of the firms in the list employ 3049 staff
O
weakening marketshare of the larger supermarkets also had an impact. Just outside the HOT 100 were Daniel Owen (including Workmates), which now has a broadened ‘white collar to trades’ multi-brand offering of construction, engineering and facilities management candidates. Pertemps also just missed the cut. Several others are sliding down the ranks, as the level for many professional staffing suppliers rose by comparison. Transline and Adecco’s Office Angels are next in line, but most are now well adrift from the HOT 100 productivity threshold. The likes of Angela Mortimer — in past years often included — have not necessarily deteriorated in their own performance, but have not been able to keep pace with the gains made by other high-value specialist sectors.
See recruiter.co.uk for the HOT 100 breakdowns of four specialist groups: IT/telecoms, technical, public sector and professionals.
Conclusion and outlook True to form, the recruitment industry’s most productive companies chose not to take a pause during this year's accounting period and enjoy the fruits of previous, at times bold, investment. Instead, they carried on, even accelerated, the expansion of their workforce — by almost 10%. Productivity just managed to keep pace, rising slightly, as new staff were brought onboard. But the benefits will be sought in this next year, as new feeearners mature. A slowdown in the rate of expansion may well happen during 2015 as new people are assimilated, cutbacks in the oil & gas sector have some impact, and ongoing global economic and geopolitical
uncertainties encourage a more cautious approach. There is also an element of industry consolidation, perhaps more evident in the past year, as several high-value/high productivity specialist recruiters (including regular members of the HOT 100) were acquired. Business mix has also shifted, as the ‘cycle’ slowly moves through, but this is anything but a smooth curve. Permanent activity has, however, picked up across some sectors and is evidenced in company disclosures and an aggregate rise in the HOT 100 gross margin. This rose for the first time since the single year bounceback from recession in 2010,
and for only the second time in 10 years. Over that period, the gross margin rate has shed — even for these, the most highly productive companies — around one-third of its aggregate value. This drop is even greater for the wider industry, as the erosion of the temp margin has at times seemed unstoppable — whether because of competitive pricing pressure or changing delivery methods — and the permanent mix has varied. These are, however, tricky decision-making times for recruiters. Some would encourage more expansion in response to the strengthened overall UK labour market, selective skills shortages, economic
recovery and demographic challenges. Yet the flow of positive official data seems to be, at best, intermittent and the geopolitical issues are mounting quickly. Investment decisions taken now could have a greaterthan-normal impact upon profitability next year, simply because there are such farreaching uncertainties. If companies are to prosper in the long term, they must combine clear strategic thinking — clinically and selectively determining where and how to invest for the future — with extracting optimal productivity from existing staff. HOT 100 constituents have proved for 10 years now that they are often the best at achieving both these goals.
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I
t’s fair to say that recruitment in the technology sector has faced a few tough years. A sluggish economy often reduces the investment made in new software and platforms, companies try to keep their systems going rather than upgrading to new technology, and budgets become tighter.
Vector however has continued to thrive, and their success is recognised for the third year in a row, as the company has just achieved top ranking for IT and technology in the Recruiter HOT 100. Donna Medway, Vector’s CEO, is delighted, especially in such a highly competitive market. “Technology is such a broad category, covering roles ranging from first line support and service desk analysts right up to interim IT Directors, and everything in between – that’s what makes me so proud, as it is a difficult category to retain. The market is very fast moving, and our business is predominantly focused on contractors.” Donna believes their success is all about the people. “We couldn’t sustain our performance without the investments that we have made both in our people and Vector Live, our bespoke system built to support our unique approach to recruitment”.
Vector is passionate about developing their staff. New members of the team generally start in the resourcing team, and go through rigorous training that has been fine-tuned over the years, as they learn to become recruitment consultants. A Vector consultant has been through a lot by the time they have their own portfolio – they manage their own business, their own requirements, and their own contractors and candidates. Vector Live continues to be developed to ensure that as much as possible can be automated throughout the recruitment and contracting process. This means resources are focused on handling roles, rather than on admin. 18 years on, the company is very different from its humble beginnings. Now in three locations, the management team have been able to identify opportunities to unlock the potential in new markets, bringing their unique approach to develop regional businesses and talent. The latest addition is an office in East Anglia, managed by Emily Coombs. Emily has been with Vector for over 9 years and has been running a highly successful team covering retail, leisure and travel. This new challenge will continue to build on the success of the South West office, focusing on developing the local market. “As specialists in technical recruitment, we are bringing something unique to this area. No one else is doing that – and yet it’s such an exciting time in the area, with a real boom in technology companies. We have some big names here, but IT in general is growing. We are building new partnerships with regional businesses, and we have a constant flow of new referrals of contractors and candidates too – I think we really have a great formula for success”. Vector has already seen the benefits in supporting a region, and Emily is keen to make sure that local people are getting the right roles. “Finding local talent is a win-win for the companies here – the benefits are felt by the clients, contractors and candidates”. What underpins Vector’s success is their rigorous approach to the recruitment process. Each role is carefully screened before it is worked on – every new
IT’S ALL ABOUT THE PEOPLE specification received is reviewed both by a resourcing manager and Wayne Starritt, Sales Director. “We want to know that any role we take on is a role we can fill. Once a job is on our system, a dedicated team of resourcers will work on it, interviewing each contractor or candidate before putting them in front of the recruitment consultant managing the role, who will then interview them again. “This means that when we put someone forward to a client, we really know they are the right person. And our contractors and candidates know that each role is a real one, and that we aren’t just fishing in the market to see who is out there. Our quality procedures mean that we take on fewer roles, as we won’t work on anything unless we can actually have control over the whole process. We are experts in recruitment, so our clients can trust us to deliver, consistently and efficiently. Everyone is looking to achieve the same thing – the client wants the role to be filled, the contractor or candidate wants the job, and we in turn want them to have the job.” I
EXPERT TECHNOLOGY RECRUITMENT
Tel 01892 771447 Email info@vector-uk.com www.vector-uk.com
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