Climate Change & The Recruitment Industry
What does climate change and the recruitment industry have in common?
No, that isn’t the start of a joke; I’m being deadly serious.
And the answer to this question has everything to do with your future success in the recruitment industry.
Deniers or Sceptics?
Those who are convinced that climate change is real, and that it’s caused by human activity, label sceptics as “climate change deniers” or even “science deniers”.
This is unfair and unhelpful.
Personally, I believe there’s plenty of evidence to support climate change and the need to act, but I don’t think calling the critics names is helpful.
Scientific progress goes something like this:
1. One person challenges a long-held theory.
2. This person is mocked and labelled a crank.
3. Others study the evidence, recognise the new theory has merit, and lend their vocal support.
4. These persons are mocked and labelled as cranks.
5. More people begin to accept the new evidence and theory until they form the majority.
6. The understanding snowballs until only a minority still hold to the original belief.
7. This minority is mocked and labelled as cranks.
This pattern exists because most people don’t have the time or inclination to study the facts for themselves, so they stick with the general consensus. This doesn’t stop the progress, but it does reduce the speed with which people accept the new reality.
Unsurprisingly, this pattern can be found in every part of human endeavour, and recruitment is no exception.
Recruitment, as a process, has changed dramatically over the last few decades, and strategies have had to change as a result.
But the pattern of progress described above means that recruitment firms who recognise the need for change earlier, have generally performed better, whereas recruitment firms that are reluctant to accept that change is taking place have found business growth a struggle. And some have even gone under.
Whereabouts in the seven-step journey do you think recruitment is right now?
1. One person challenges a long-held theory.
The “long-held theory” in this instance is that contingency – or transactional – recruitment is the best and simplest method to generate profits. And the “one person” is actually several experienced recruiters who believe that employers are tired of the inefficiencies and poor service provided by recruiters and that a more consultative approach is necessary (via retained recruitment and MSPs).
2. This person is mocked and labelled a crank.
Perhaps a slight overstatement – but if you’ve ever read some of the more critical comments on my articles, you’ll know what I’m getting at. For every recruiter that agrees with our stance on the superiority of consultative recruitment over the transactional variety, there are a handful that regard this as a threat to their main business model.
3. Others study the evidence, recognise the new theory has merit, and lend their vocal support.
I, and others like me, have pointed to data published in various studies that indicate that transactional recruitment is falling out of favour. I’ve added to this body of explanation by pointing to additional data that support this interpretation – such as the 96% of our placements that are still in the role after 12 months.
Over 1,000 recruiters have adopted the i-intro® strategy focusing on retained and managed service recruitment, and most have found this approach to be effective. This doesn’t necessarily prove my position beyond all doubt, but it adds to the growing weight of the data.
4. These persons are mocked and labelled as cranks.
More and more recruiters are recognising the importance of developing value-added consultative recruitment services, but they’re still the minority. And, as such, they still get some stick.
We’re still some way off reaching step five, but I believe it’s only a matter of time.
Data is Never Enough
Numbers are good, but they only get you so far. For example, adding to the large body of facts and figures is the Economic Report 2019, produced by the World Employment Confederation.
According to this global study, sales revenue from RPO and MSP services are up 16% and 10% respectively.
In the top five markets combined (USA, Japan, United Kingdom, Germany and Australia), direct recruitment makes up 13% of the market (agency work still makes up the lion’s share) and MSPs accounts for 5%.
It’s difficult to make definitive assertions based on this snapshot (from two years ago), but one reasonable interpretation is that RPOs and MSPs are gaining in popularity.
But this is just more of what I’ve been saying for years.
At some point the numbers just become noise and those who are on the fence don’t know what to believe.
Which is why it can take dramatic events to underscore what numbers alone cannot.
For instance, many climate change sceptics who were unmoved by the data, became convinced by the arguments when they saw freak weather events and melting glaciers.
It became harder to question the data interpretation when the predicted changes were all over the news.
It’s hard to imagine something quite so dramatic taking place in the recruitment industry, but it doesn’t mean that significant events aren’t capable of moving people to act. It’s simply that the events will be more localised and more personally felt.
For example…
A good friend of mine has been recruiting for a big company for years. The arrangement is exclusive but still transactional in nature.
Recently, the company put together expansive plans that called for hundreds of new hires over the next few years. To facilitate this, the company has decided they want an MSP, but instead of inviting my friend to set it up, they’ve opened it to tender.
Any recruitment firm that can prove they have the experience and capacity can throw their hat into the ring.
Why didn’t this employer just continue to hire through a contingency contract? The tender invitation document makes it clear – they want an efficient, value-added service with guaranteed levels of employee retention.
It’s very likely that my friend is going to lose this client, and for him personally, this might be his “polar bear on a floating iceberg” moment.
It’s hard to argue against retainers and MSPs eventually dominating the recruitment industry when you’ve just lost a long-term client because they want a service that you don’t currently provide.
***
There’s one more way in which climate change and the recruitment industry are similar.
Wait and see, is not an option!
Maybe, in a few decades, it will turn out that CO2 isn’t the reason for rising temperatures. But it’s no good doing nothing until we know for certain when definitive proof that it IS the villain in this drama is the extinction of the human race.
The same is true for recruitment.
If you wait and see whether retained recruitment and MSPs are going to kill the contingency market BEFORE you act, you might find that the definitive proof is when you go into administration.
And look at it this way…
Where’s the harm in adding retained and MSP services to your skillset?
If transactional recruitment survives, you’ve still opened up some lucrative business opportunities. And if transactional recruitment dies, you’re well placed to survive the chaos that will result.
What does climate change and the recruitment industry have in common?