Research Report: Predicting the Future
Forward planning is a major part of any business. If management has the skill to foresee the future of the business, there is a significantly higher chance of success in the long-term. In addition, as staffing agencies expand into other countries, the estimates for the market size of staffing markets will be more important. You need to have a precise figure for the scale of your potential market, this is such an important part of effective management. Staffing Industry Analysts published a report that will help managers and owners understand more.
SIA produces a ‘Global Staffing Industry Market Estimates and Forecast’ twice a year. The report includes estimates and forecasts for the staffing industries based on revenue. The data refers to regional and historical data. There is also a list of the 17 biggest countries per staffing industry revenue.
This report can be used by staffing agencies to rank their performance against others. Investors might also find the report useful in their decision-making process. SIA Corporate and CWS Council members can gain access to the complete report.
The staffing agency industry generated worldwide revenue of 409€ billion, $461 billion, in 2017. This was a 7% increase from the previous year. In order to calculate the statistics, staffing was divided into two categories; the temporary staffing service and the place and search service (direct hire). Out of the 409€ billion, 81% was generated from temporary staffing services. Regarding countries, the US, Japan, and the UK were the three countries that generated the most revenue. Germany, France, and the Netherlands were also countries that contributed significantly to the revenue but not nearly as much as the leading three.
How does this help our understanding of the future? 2018 continued on a similar path as 2017. There was an increase in the staffing agency services of 7%. Unless we witness a huge global economic downturn, we can safely assume that the figures will continue to rise. This will be helped along by a set of programs that will expand the workforce into more countries.
Europe has seen an increase in the staffing markets overall. Unfortunately, the Brexit has created a cloud of doubt over the UK and the same growth hasn’t been seen. Only a 2% increase is expected for the UK staffing market in 2019.
This strong growth in the staffing market can be put down to a healthy economic backdrop. IMF estimates a 3.9% increase in GDP. Working conditions have to be mentioned. Germany has tightened labor regulations while Italy has seen a labor reform. There are also a number of countries that have a low penetration rate. They have the space to grow and are ready to do so as soon as there is an increase in the staffing market.
One problem we are facing generally in the staffing agency market is the lack of talent. This is not to say that hires from a staffing agency are not capable of doing the job, quite the opposite. But the imbalance in demand and supply can cause a bigger problem. When the labor market is tight, companies turn to staffing agencies to fill their vacancies. The more we use staffing agencies, the quicker the highly skilled agency workers are being snapped up. New talent is hard to find.
The world is getting more complicated and things will become more difficult to predict. The Brexit and trade wars between China and the US are going to have major knock-on effects on the world’s economy. It will be a case of watch this space closely! As for now, remain focused on the high growth in the staffing market, add this into your management strategy so allow company growth in the future.