Recruiter Hot 100 2015

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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

Editor: DeeDee Doke deedee.doke@recruiter.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

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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

2015 Hot 100 v2 REVISED.indd 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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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.

HOT.01.16.010-011.indd 10

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.

24/11/2015 09:13

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

↗

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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