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Why Is Recruitment So Hard? Recruitment Industry Challenges In 2024
Created by Robert Garner on Mon Apr 29 2024 and edited on Thu Aug 01 2024
Recruitment is fucking hard right now and I don’t even work in recruitment anymore, the industry is challenging to say the least! And selling to the recruitment sector is even harder! It’s one thing selling an expensive product to someone when they have money but it’s something else altogether when they don’t even have the budget.
I launched my digital design agency back in the summer of 2023 and unbeknownst to me the market was already in decline at that stage. If I’d known that back then, then I probably would have waited another 9 months or so, then launched it but hey ho.
I’ve been speaking with recruitment agency owners a whole lot over the past 3 months and everyone is finding it damn hard! It seems like there isn’t a single sector that hasn’t been hit. Some sectors like tech for example have been hit harder than others but everyone is feeling the pressure.
The Economy
Now we’re (hopefully) coming out of a recession, Q3 & Q4 were bad last year let’s face it. The initial figures for January and February are looking better with a very small amount of growth but it’s not really been felt by the recruitment agencies yet. Let’s see what March was like when the final figures come out soon and hopefully the recession is over! I hate recessions and I hated the 2008/2009 recession. They always fuck my shit up. I was made redundant from a role in February 2009, despite being one of their top billers - my desk was completely dead. I ended up working commission only for several months, which is tough when the market is good, let alone when the best fee you can get (if you’re lucky) is a £1k per placement fee!
High Unemployment
Unemployment figures seem to be rising, which is never good for recruiters. We’re still seeing some “wage inflation” but I’m sure this will imminently slow down and we’ll see a retraction in wages. I’ve already seen a job today for a .Net Developer, based in London, looking for a degree and 2 years experience for £35k-£42k. A little over a year ago this role would have been paying £45k-£50k as a minimum. And I saw an advert for a Senior Full Stack Developer role paying £55k, which is just not going to happen. To that company you’ll need another £10k on that role to get anyone reasonable.
Lots Of Applications
Applications are still high. I was speaking with the operations manager of a health tech firm based in East London recently and she mentioned where they might only receive a few relevant applications for a developer role a little over a year ago they’re now receiving 20-30 relevant applications for that same role! Unbelievable. Why pay £7k to a recruitment agency when you can ask one of the developers to spend a half day picking out relevant CVs from a whole stack?!
It's Hard Reaching Clients
No one’s picking up the telephone. Now in all fairness you’re probably dodging a bullet by not picking up the phone to me because I’m just going to pitch you a new recruitment agency website but how do you know it’s me? I can’t tell you how many times I’ve called a recruitment agency with 10+ consultants and no one has picked up the switchboard. You’re missing out on business here. Why make it harder for yourself than it needs to be?
Lack Of Training
There’s a lot of people that have come into the market in the past couple of years and they just can’t pitch. And in all fairness it’s not their fault. They came into a buoyant market where clients were screaming out for talent and talent was happy to move after being in lockdown and happy to move for an extra £5k on the basic. The market is very different and if you can’t pitch then recruitment is really tough!
Recruitment Technology
There’s too many recruitment tools out there. I know I work in recruitment technology, literally writing code every day but at least my recruitment websites just sit there and hopefully bring in new clients and candidates with minimal supervision from you or your consultants. We’re asking our recruitment consultants to learn too many new pieces of technology. How have we got all this new recruitment technology but everyone is still billing the same numbers they were doing 10 years ago? How does this make any sense? Billings have stayed roughly the same but costs have risen and margins have dropped. Is new recruitment technology slowing down your consultants?
Conclusion
I worked in the recruitment industry from 2006 - 2020 and I saw a fair number of upticks and down turns in the economy - the recruitment industry has always faced challenges. I saw some parts of my niche become stagnant while other areas excelled. What I've learned is that the bad times never last longer than a year before the market picks back up again and when it does we always see a pretty strong 10 year period. I'm sure things will start improving in the next few months.
Anyway that’s just my two cents on it. I might not be totally correct but I feel like a lot of it is hitting the target. If you’re struggling at the moment then maybe a newly designed recruitment website could be the answer so get in touch for a chat.
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Robert Garner
Rob has been working within the recruitment industry since 2006, selling recruitment advertising space, working within recruitment, running his own recruitment firm, launching job boards, working for in-house talent acquisition teams and creating enterprise level recruitment software and now websites for recruitment agencies.