The Future of the Recruitment Industry Report: 2024
3 Top Recruitment Trends Shaping The Year Ahead
As an agency leader it can be difficult to understand how your agency is performing against a backdrop of economic fluctuations, candidate shortages and other external pressures that impact the sales performance. That's why, at the end of each year we survey agency leaders from hundreds of agencies to compile a comprehensive snapshot of the challenges and opportunities that lie ahead.
In this article we summarise three top trends that will impact recruitment agencies as they navigate 2024, drawing on data from the Future of the Recruitment Industry Report: 2024. Let's dive in!
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As agency leaders look forward into 2024 there is a clear air of optimism sweeping through the recruitment industry. A staggering 60% of all recruitment leaders are riding high on positive sentiments, buoyed by the anticipation of promising opportunities ahead.
Amidst this surge, regional forecasts indicate a positive shift in sales growth compared to 2023, signaling the potential end of tougher times.
Every indication from the Future Recruitment Industry Report: 2024 indicates that agency leaders are expecting a more positive sales year than has been experienced in recent years. With agency leaders intending to grow headcount, the forecast is for significant growth.
84% of agency owners are forecasting sales growth in 2024
The ambitious spirit extends further, as 63% of agency leaders plan to expand their teams in 2024, signalling a commitment to growth and resilience.
Optimistic outlook for 2024
Late in 2023, Michelle Davies, the founder of Candidate Source and a job board specialist, emphasised the escalating costs of job boards during a conversation with Firefish CEO Wendy McDougall. Michelle reported that some agencies experienced a staggering 30-40% increase in their job board spending throughout 2023.
Faced with such significantly increasing job board costs, agency owners are recalibrating their approach to look organically first in 2024.
only 20% of agency owners are increasing their use of job boards.
40% of agency owners are looking to use email marketing as their main attraction strategy in 2024, making it the strategy with the highest YoY growth for the second consecutive year.
The shift towards organic sourcing is then compounded by a clear intention to look to the CRM first to find candidates, with 67% of agency owners naming re-engaging their existing databases as their main strategy for 2024.
That the top three sourcing strategies look to source organically in order to feed an effective database correlates directly to a decrease in intent to use traditional job boards.
Amidst the challenges posed by persistent talent shortages and shifting economic landscapes, the 'Future of the Recruitment Industry Survey' results tell us that recruitment agencies are leaning more and more towards organic sourcing strategies for candidate acquisition.
According to agency leaders, 70% of agencies plan to utilise social sourcing as their main candidate attraction strategy in 2024.
Organic sourcing first
The salary conflict
In the recruitment industry, the spotlight on base salary as the pivotal factor for candidate attraction is glaring - 64% of candidates highlight the need for a salary increase as very important. What's more, the 'Future of the Recruitment Industry Survey' tells us that agency owners agree, recognising that base salaries are the most important factor in candidate attraction.
84% of agency owners believe salary is the most important factor in candidate attraction
However, a stark misalignment emerges as over 50% of these leaders report no increase in their recruiters' base salaries over the past 12 months.
The conflict between the recognised importance of base salaries and the lack of increases within recruitment industries themselves demonstrates the pressure that the recruitment industry has faced from economic challenges over the past few years.
The 'Future of the Recruitment Agency Survey' demonstrated that agency leaders believe the next most important factor in candidate attraction is flexible working. 67% ranked a hybrid working model as most important and an additional 24% factored a fully remote model top.
It is perhaps no surprise then that agency leaders reported a significant increase in remote working practices with 83% of agencies now adopting a hybrid model. It could therefore be concluded that while base salary increases are not possible, other concessions are being made in order to recruiter talent.
The cost of living pressures are growing at the same time that agencies are grappling with their own financial pressures. This makes the conundrum of allocating funds for increased salaries, while simultaneously meeting escalating operational expenses, a difficult one to solve.
This challenge may in part explain the ever increasing shift towards flexible working arrangements.
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