Recruiting, Technology

In-House Recruiters Are Out; Staffing Firms Are In

As technology becomes more advanced, the human race must be prepared to adapt with it, or risk being left behind. While recruiting technology is making recruiters lives easier, it’s also shaping the hiring landscape. Is your company prepared for this shift?


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Recent surveys of hiring managers and staffing firm employees from CareerBuilder, Inavero, and the American Staffing Association (ASA) identified the major obstacles facing hiring managers and staffing firms, and what the future looks like given the rapid rate of technological innovation.

Recruiters Roles Are Being Reduced as Employers Turn to Staffing Firms

While most Millennial hiring managers (59%) strongly agree that technology will reduce recruiters’ roles in their companies’ talent acquisition processes over the next 5 years, hiring managers across all generations are keen to leverage the data staffing firms can provide, including salary data and industry hiring trends.
In the current market, hiring managers’ primary reasons for working with staffing firms include the desire to shorten the hiring process (42%) and access to candidates with specialized skills (41%), yet 40% of companies maintain recruitment processes in-house to save money.

Staffing Firms Can Eliminate Technology Limitations

Hiring managers and staffing industry leaders alike agree technology will impact the industry; 67% of hiring managers believe it is very or extremely important their staffing firms use up-to-date technology, and 32% of staffing industry leaders plan to invest in new technology this year.
Most hiring managers also think staffing firms can be helpful in addressing top problems faced during the recruitment process; specifically, 81% believe that staffing firms can help eliminate issues due to technology limitations.

Additional Key Findings

Companies partner with staffing firms to improve and streamline the hiring processes, and most are not exclusively partnered with one firm.

  • Fifty-four percent of hiring managers plan to increase their use of staffing firms over the next 5 years.
  • Hiring managers cite top pain points in the recruitment process as access to candidates with the right skills (52%), time to hire (40%), and budget (34%).
  • Sixty-six percent of hiring managers feel using a staffing firm would be very helpful in gaining access to the right candidates.
  • According to hiring managers, the key reasons for working with staffing firms include that they needed to hire someone more quickly than they could do on their own (42%), access to candidates with specialized skills (41%), and they had a hard time filling the position on their own (37%).
  • The main reasons hiring managers do not work with staffing firms are that they were trying to save money (40%), staffing agencies are not hiring the type of positions needed (28%), and they believe the best candidates do not work with staffing agencies (26%).

Staffing firms must be up-to-date on the technology they use.

  • Sixty-seven percent of hiring managers believe it is very or extremely important for their staffing firms to use up-to-date technology.
  • Seventy-four percent of hiring managers believe using up-to-date technology can help differentiate a staffing firm.
  • At staffing firms, leaders cite inconsistent use of systems as their biggest frustration with technologies (31%), while at the field level, main frustrations can be attributed to outdated candidate data (29%).
  • Applicant Tracking Systems (ATS) are ranked as the most valuable technology used by staffing firms (31%), followed by social media sites (19%), and job boards (15%); however, both leadership and field workers at staffing firms believe that ATS technologies are in the most need of improvement.
  • The most common resources used include technologies to match open jobs to potential candidates (45%), use of a single search bar to look at multiple third-party résumé databases (40%), and video or online interviewing capabilities (38%).

Hiring managers are made aware of new staffing firms through a variety of different sources including the firm’s reputation within their industry (12%), proactive recommendations (12%), and through experience hiring with the firm at a previous job (12%).

  • The primary resources companies use when vetting new staffing firms are similar to how they initially learn about these agencies and include asking people in their professional networks for referrals (34%), the firm’s reputation within the industry (34%), and reading the staffing firm’s website (27%).
  • Main reasons for selecting a primary staffing firm include the firm’s ability to find specific or niche skill sets (16%), strong reputations (15%), and the ability to find high quality talent (15%).
  • Most staffing firm leaders have seen revenue increases over the past year (66%).

While all is not lost for your in-house recruiters, these survey findings are something to keep in mind as your company grows and changes alongside the technology it uses.

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