The REC have recently released their annual Industry Trends Survey (2012/13)which reveals that the average placement fee value has fallen for the fourth time in five years, and during that period it has diminished by almost one-third.
This might seem like good news for employers who rely on recruitment firms to help them fill key positions, but a closer look at the numbers suggests that the value offered by recruiters is diminishing in equal measure.
The logic for this conclusion is very straightforward; if inflation is going up and average fees are going down, then a recruitment firm can only survive by engaging more and more clients.
Has this happened?
Yes. Placements per consultant have increased from 16.5 to 21.0pa over five years, an increase of around 27%.
In other words, recruiters need to engage more clients and work on filling more positions to earn the same amount of money.
Employers may be paying less to engage a recruiter, but they’re also getting less of the consultant’s time. And consultants are finding their energies and resources stretched ever further.
This is BAD NEWS for everyone!
If a consultant has increasingly less time to spend on completing assignments, their ability to find the best candidate for the role is going to weaken. Consequently, the chances that a placement will fail are going to increase.
Saving a couple of percentage points on a recruiter’s fee matters little if, within months, the employer has to bear the cost of starting the recruitment process all over again.
And if trends continue then this situation is only going to get worse. If fees continue to drop and annual placements per consultant continue to rise, then the end result is going to be less and less satisfactory for everybody involved in this process.
There IS a solution
Although there are many factors involved in these trends, an important element to consider is how little recruitment practices have moved with the times. Every other industry, almost without exception, has become more and more technologically advanced and yet recruitment techniques have barely shifted.
For the most part, the process is still limited to pulling candidates from a database, posting on a few job boards, and then delivering a handful of CVs to the employer. When there are so many easily accessible ways to improve the quality and efficacy of this process there really is no excuse for sticking to such an old-fashioned approach.
Instead of trying to cut corners and work faster, for ever-diminishing fees, recruiters should be looking for ways to improve the quality of service they deliver to clients and candidates. The truth is that employers are perfectly willing to pay reasonable fees that reflect the current economy when the service with which they are provided is packed with valuable features that genuinely improve the overall result.
GrassGreener Group’s consultants annual placements are way below the industry average because we provide our clients with a comprehensive, end-to-end service that guarantees results and saves the employer time and, most importantly, money.
Yes, it takes a little longer to complete an assignment but, when the end results are so spectacular, this extra effort is more than justified.
When all is said and done, recruitment clients deserve more…
They Deserve Better Technology
GrassGreener GroupTM use the latest advances in behavioural and competency-based assessments which forms an integral part of our comprehensive pre-screening process. Via i-intro® the results are presented in an easily accessible online format along with video introductions, references etc.
As a result, our clients enjoy an unparalleled new employee retention rate of at least 96%. Yes, 96% of candidates placed using the i-intro® process are still in position after 12 months.
They Deserve to Save Time
i-intro® presents the candidate shortlist to the client in a smart, online format that is accessible from any Internet-enabled device, from anywhere in the world. This presentation also makes it easy to pick out the key information on each candidate and speeds up the decision-making process.
They Deserve to Save Money
The i-intro® process pre-qualifies candidates and collates crucial information, making it easier to eliminate unsuitable candidates before the face-to-face interviews even begin. Fewer interviews means less commercial downtime, and less expense for the client.
They Deserve to Have Comprehensive Guarantees
We offer a 30-day 100% money back guarantee on all of our placements and a free replacement policy of up to 12 months, depending on the seniority of the role. In the unlikely event that one of our placements doesn’t work out, there is no additional cost to the client.
When an industry is reduced to competing predominantly of speed of service and price, the ability of everybody involved to offer quality is bound to diminish. The answer is not to continue to slash fees, but to substantially increase the quality and value that is offered to clients.
What would YOU like to see recruiters offer or improve to increase the value and success of their services?