Permanent Recruitment Market Intelligence

Industry Outlook & Drivers

Global Permanent Recruitment Market Insights

• The market is forecasted to grow at CAGR of 16-18 percent to reach ~$400 billion by 2020
• US has highest market maturity followed by UK and then Western Europe. In APAC, countries like Australia and Japan contributes moderately in the recruitment market. Other countries in APAC and Western LATAM and eastern Europe are driving the demand for recruitment services such as RPO and Executive search in upcoming years

Global Permanent Recruitment Market Maturity

• North America and Europe are mature markets in terms of buyers and service providers. The outsourcing of recruitment services is high in North America and Western Europe
• APAC and LATAM are witnessing increasing adoption due to the efforts by large global buyers to consolidate supply base

Global Recruitment Process Outsourcing Industry Trend

The global RPO industry significantly increased by 16 percent from 2013 to 2018 , and emerging economies are expected to contribute largely in the  upcoming 2 – 3 years. Due to increase in technology penetration, recruitment services are expected to rise by 20 percent in 2018 – 2020
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Adoption Rate of Technology in RPO

• RPO service providers are offering recruitment solutions and technological platforms. Companies either co-source or completely outsource technology platforms to RPO vendors. Various technology platforms exist and large companies have adopted it in the past

• While ATS helps in managing business units, compliance, hourly positions, social and candidate experience, TAM supports a complete talent database for active, as well as passive candidate profiles for future vacancies, and helps in succession planning with real-time simulations. Along with TAM systems, integrating employer branding tools with recruitment process is an emerging trend in the recruitment landscape

Supplier Innovations

• Currently, Oracle Taleo lacks superior artificial intelligence and machine learning capabilities in ATS solutions when compared to ATS start-up eco-system service offerings to small – medium companies
• Google Hire ATS is the clear market disruptor and aims to bring down the job advertisement spend incurred by employers, by integrating its Google Ads solutions. Currently, its solutions are targeted at small –medium companies only
• iCIMS, Hays, Jibe, Johnson & Johnson, FedEx, CareerBuilder, Dice, etc., are some of the early adopters in “Google Cloud Job Discovery Beta Program”

Technology Tools Adopted across Industries

• Most of the multinational companies are adopting various technology tools for recruitment purposes across geographies. There exists homegrown applications for automated reporting and analytics whereas, SAP and Oracle provides talent management suites for managing workforce
• The adoption technology solutions for recruitment is considered to be high in retail and IT industry

Global RPO Drivers and Constraints

Multinational firms are restructuring their workforce to attain higher labor productivity and leverage the skillsets of the employees. In such situations, cost efficiency, higher productivity and access to better technology drives the recruitment industry across geographies.

Growth Drivers

• Cost Reduction: Outsourcing recruitment allows the companies to transfer the cost risks involved in recruitment process to the recruitment partners thus reducing cost
• Social Network Adoption: Buyers are evaluating the option of using social media to identify the potential candidates to best-fit their internal requirement. On an average, 25 – 30 percent of social tools are adopted by companies across the globe to source and advertise positions for recruitment
• Scalability:Outsourcing recruitment results in a more scalability and the ability to meet the sudden surge in manpower requirements as it is the core business of the recruitment partner
• Improving Recruitment Process: Engaging with an RPO will streamline the overall recruitment process. The RPO vendor will analyze the recruitment process to spot the where overlap, inefficiency and excessive costs occur and will device a custom recruitment process
• Access to Better Technology: The RPO vendors have readily available technology like application tracking system, CV management software that can increase the efficiency of the overall recruitment process

Constraints

Lack of Client Adoption Internally: The internal recruitment department, which is already existing might show some resistance to adopt to the new framework and processes brought in by the RPO vendor

Other major constraints are:

• Competition with internal resources
• Changing position requirements
• Unrealistic expectations about talent availability
• Change in the management from the client's side