What The Downturn Means for The Recruitment Industry with James Osborne, Co-Founder of The Recruitment Network
In the third episode of The WNTD podcast, we were joined byJames Osborne, Co-Founder of The Recruitment Network, the fastest growing community for recruitment leaders who want to significantly improve their performance and profitability with purpose.
Where do you think the recruitment sector is heading?
From a purely commercial point of view, the last couple of years have been extraordinary for the industry – very positive, in the sense that recruitment companies are largely very profitable at the moment, they’ve managed to scale their businesses over this period and lay solid foundations.
There have been challenges though, including talent shortages. Every business owner, whatever industry they’re in, have learned a lot about their businesses, because they’ve had to navigate them and manage their people through extra-ordinary times, and that’s been really healthy. There’s a lot more focus now on building profitability as opposed to just turnover and focusing on proper engagement with employees as opposed to just having people hitting KPIs. The mindset has shifted in that sense which I think is good for the industry.
Sometimes, especially during difficult times, it’s easy to get caught up in industry news and what people in the sector are saying. But I think, there are periods that you have to just see through and almost prepare for the worst. What do you think?
The reality is, we’re going through different types of downturns. The one we had two years ago when Covid hit wasn’t a traditional recession or downturn, because the government stepped in, to bail companies out and pay furlough etc. So, a lot of people and businesses haven’t actually been through a real downturn.
The one that we’re currently heading into is a flatlining of the marketplace – and you always get these cycles. It’s going to be a very different downturn for the recruitment sector, especially since we’re still in an environment where there are mass talent shortages, mass amounts of people leaving jobs, there aren’t enough skills – so, we may see an economic downturn in the sector and there’s likely to be some consolidation. But there’s still going to be huge demand for recruiters and talent, that’s the reality.
An important thing to say is, we can talk ourselves into recession because we begin to believe our own rhetoric. If you read the newspaper headlines at the moment, they’re all sensationalised. If you actually take a look at the data, you’ll seen Coinbase announced an 18% cut of its workers in January, for example. But if you stop to think about what this really means, it’s not necessarily indicative that we’re headed into a recession, it just means the company has hired aggressively over the last 18 months – 2 years and they’ve decided to swap out some of the people they don’t need for their next stage of growth. So, that’s an example of just a short-term recession, it’s not a big deal. But when people just read the headlines, they start to panic.
Recruitment can often seem salesy, and the way companies pitch it now is more focused towards business development. But how can companies make this happen?
The reality is, business development in any organisation should never stop with the business-development department. Everybody in a business should be doing business development of some description; whether you’re a receptionist, whether your administrator, everyone has a part to play in the business to be the process.Should you ever stop doing business development? No, not at all. But does it change and morph? Of course, it does.
You can listen to the full episode, here.
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