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July 28, 2021

The Competitive Threats to Staffing and Recruiting, And How to Deal With Them

Unpopular (but accurate) opinion: the digital experience offered by staffing and recruiting agencies is at least five years behind that offered by other industries.

Think about it. Ecommerce stores offer demo videos, 360-degree product views, and endless customer reviews. Realtors offer virtual walk-throughs and beautiful drone footage, giving their customers a real and tangible sense of a property. Moving slightly closer to home, gig economy platforms like Upwork and Fiverr offer headshots, work histories, and reviews of both candidates and employers.

And then there’s the staffing and recruiting industry.

“You can look at 10,000 staffing agency websites – the only thing you’ll find is a request form,” says Jan Jedlinksi, Founder and CEO of Candidately, and as he found out, even this can be a dead end. “I recently sent requests to 100 traditional staffing agencies via their websites to find somebody for our team. You know how many replied to me? Three.”

Upwork and Fiverr have been around for a while, but their growth accelerated during COVID, as organizations got comfortable with remote working and dealing with people exclusively over email. Unless the staffing industry works to catch up to these platforms in terms of technology, their rise could be the industry’s fall.

That said, gig economy platforms have their limitations. They’re more or less limited to remote work, and they fall down in a big way when it comes to service. If a person doesn’t show for a job, Fiverr and Upwork sit there shrugging their shoulders. They’re not actively involved in the process.

Catch up to them in terms of technology, and the staffing industry has an opportunity to outpace them in terms of service.

The continued need for human touch

The staffing industry’s proposition is that we’re good matchmakers. We’re good at understanding a client’s needs and matching talents to them – i.e. the human elements of the process. There’s a golden opportunity to do better, by combining this elite human touch with equally elite technology.

“The complexity of many staffing and recruiting transactions demand the attention of a human,” Jedlinksi continues. “We’re not talking an Uber driver you pay $10. Say you spend $100,000 hiring a Java developer for eight months – that’s almost like buying an apartment. There’s no way you’d want that experience to be fully digital. You want someone to be accountable, to ensure that this person is up to the task, and to fix things if they go wrong.”

You should make the experience digital and modern, but you should retain a human element. Automated technologies are almost always a huge improvement on old ways of working, and should be leaned on heavily. You just want to ensure that if something is particularly high touch, or if something goes particularly wrong, a human jumps in. There may never be a point where machines are capable of human-style problem-solving.

When you boil it right down to its bare bones, the aim of staffing technology should be to minimize the time from a candidate seeing your brand to that same candidate getting their first paycheck. Your decision to take on any piece of technology should really be based on that, as Jedlinksi explains.

“I spoke to a staffing owner recently who said ‘your product is really cool and I really like it, but in the end, does it actually help me get people to work?’ That’s the only thing that mattered to him: finding really cool jobs for really cool people. He wanted to make sure that the technology would help him to do that better and/or faster.”

As an industry we can overcomplicate tech adoption, getting distracted by the shiny and new. Sometimes we just have to take a step back, and see whether or not a solution will help us to do what we want and need to do.

Post-pandemic crystal balling

Jedlinksi has seen that the staffing industry is more than capable of swift, large-scale change, and feels as though its evolution will only accelerate into the future.

“Even back in 2015, I began to see larger staffing organizations closing branches in favor of a single, central location. Before the pandemic, I spoke to a lot of staffing owners who didn’t know about Slack or Microsoft Teams, but by 2020 they were fully remote. Where will it go next? I think the switch to remote working will lead to small firms or even individual recruiters going global, placing people all over the world by having a very concise and verticalized brand.”

This is something that Jedlinksi experienced firsthand, as it was where his search for a new team member ended. After he’d sent those 100 requests out to traditional staffing firms and got next to nothing back, he stumbled upon  Flockjay – a tech sales training provider that worked to place the students who had graduated its course. Instead of filling out a form, he sent a message via an on-screen pop-up. Within five minutes he was on a call with someone who had done a quick bit of research on Candidately, and knew exactly how they could help. The organization ended up winning his business.

“If staffing firms don’t change, you'll see that there will be more and more Flockjays coming into the market that will just sweep away the traditional firms, many of whom were probably very convinced of their business model and trajectory.”

A training provider that can upskill people in a specific vertical, then place those people in that same vertical, is a huge threat to traditional staffing firms. These organizations have an intimate relationship with a highly motivated pool of candidates who boast a highly specialized skill set. They have the resources, and are now building up their knowledge on how and where to deploy people, and are doing so by employing smart tech and super concise messaging.

The staffing industry has a choice: get ahead or fall behind.

Developing an evolved hiring experience

How do you get ahead of new players like Fiverr, Upwork, and Flockjay? It’s time for the hiring experience to evolve.

“When you look at staffing websites today, most of the information on there doesn't lead to conversion. Again, compare a real estate website with a staffing site. There’s an opportunity to go far beyond a simple request form (that, as we know, often leads nowhere.) At Candidately, we help staffing companies to take their assets – available candidates – and use that as a way to get in touch with the customer.”

Instead of seeing a list of services and a request form, which might lead to a call back eventually, a website visitor is instead served up a list of people with the skill set they need, and who might be coming off assignment in the next week. If they see someone they like, they speak to a hiring manager. It’s an Upwork or Fiverr style model, but one in which the staffing firm retains its relevance, and is still able to offer that all-important human touch.

Instead of despairingly filling in request form after request form, an employer in need of talent can say ‘I know ABC Staffing has candidates on their website – let’s take a look at what they have.’ It turns hiring into the online shopping experience that people are used to, and removes a lot of time-consuming steps from the process which results in the best candidates being snapped up before they can be secured.

If the goal is to minimize the time from a candidate seeing your brand to that same candidate getting their first paycheck, this system is a great way to do it. And if you don’t make the most of this tech, others will, and indeed already are. The longer you leave it, the further behind you’ll be.

Or, more optimistically, the sooner you get to it, the further ahead you’ll be. Check out episode 33 of the You Own the Experience Podcast to learn more. 

Topic(s): Podcast