Before we commence the discussion of the various staffing challenges faced by an agency, we need to understand the industry briefly. This understanding will build a strong foundation for the challenges the staffing industry faces.Generally, the staffing industry worldwide is considered more for short-term recruitment, i.e., Contract-based and temporary positions, as opposed to a recruitment company that provides a permanent talent pool to the company.According to the statistics compiled by Statista, in the year 2019, the global staffing industry has generated revenue of 497 billion US Dollars. Out of this, the US staffing industry single-handedly generated 161 billion US Dollars and 85% of this revenue was generated because of the temporary and contract employment sector.The annual temporary and contractual workforce totals to around 16 million with an average working tenure of 10.1 weeks. With all this information known, we should move ahead and list the staffing challenges and try to give out a simple solution along with it.
The US Staffing Industry faces multiple challenges while operating due to the various aspects that affect the process of recruitment and the rest. The staffing challenges are:
- Talent Shortages
The first one from the list of staffing challenges is the shortage of talents.The 2020 Global Recruitment Insights and Data (GRID) site by Bullhorn states that the top challenge faced by more than 73% of staffing agencies or recruiters is talent shortages.This means that while the recruitment drive takes place, the recruiters try to reach out to two pools of talent. First, those who are unemployed and are actively looking for a job, and second, the group of exemplary talent pool that is already employed.The former is easier to go through with the recruitment process but since the most talented individuals are employed, it gets slightly difficult to find the best candidate according to the client’s needs.Thus, it becomes extremely important for them to use cold outreach to contact them and try to provide their client with the best talent in the market.To support this fact, there is a report from the professional networking website, LinkedIn. According to the report, about 87% of the people are open to new jobs and opportunities. This directly translates to the skills of the recruiters in picking out the right fit for the potential candidates or employees.Another aspect of this staffing challenge is the high employment rate.If there is a higher rate of employment, it becomes equally difficult to find the perfect employee. There is always a bunch of professionals that are the best match for a certain profile and then there is a group that is looking for a job but not adequately qualified.Because of this, the shortage of talent persists anyway.
- High Competition
The next on the list of staffing challenges is the high competition among the eligible candidates. This is a repercussion of the previous challenge. A smaller pool of talent is equivalent to higher competition among them.Thus, the businesses are required to offer highly lucrative offers as compared to their competitors in order to claim the best for their organization. This offering is not just limited to the financial compensation a company offers.According to a 2019 CNBC/ Survey Monkey Workplace Happiness Index Study, non-monetary perks and compensations are found to be the biggest boost for an individual and contribute heavily to job happiness.Further, 9% of people preferred more paid time off in improving their job satisfaction, and 14% prioritized training and learning opportunities over others.Additionally, autonomy to work, contribution in the workplace, opportunity to grow and meaning were also marked by many as important qualities a workplace must have.In these situations, it is suggested for the staffing agency to specialize in order to assist themselves in “speed to the candidate”. This translates to them choosing a specific niche of staffing and working harder to achieve expertise.This expertise will also reduce your dependency on technological aids and speed up the process of recruitment. Although there is no denying that technology helps you reach a larger group but having a specialization gives them more leeway.When an organization has a database for a particular sort, it becomes more likely for them to survive the competition in the market even without any high-end tools at their disposal.
Are you wondering how?
Well, that’s because you know how, when, and where to find the perfect for a client and this quickens your process of recruitment. This also gives you leverage in a situation where you place semi-skilled labor as you can get them to work efficiently.
- Slow Hiring Processes
Imagine the recruitment process taking so long to conclude that you lose interest in the job and move on to looking for similar and quicker options.
Well, the slow hiring process is one of the key reasons a highly qualified candidate could check out of this job opening and move on to a quicker one. This is the next staffing challenge faced as you have to keep the potential candidate engaged in the process.According to a study conducted by Glassdoor in 2017, the average hiring process time is around 24 days in the United States. Some positions and industries may want a shorter or a much longer hiring process than that.For instance, the recruitment process carried out by the government is concluded in about 54 days and contrarily, in bars and restaurants, the process is completed in approximately 10 days.Talking from the perspective of a candidate, a company that is longer than the industry average hiring process time, might be a turn-off for them. These slow pace process exposes the company to a few risks like:
- A competitor approaches the candidate and he is willing to work for them instead.
- The candidate has been appearing at interviews for multiple companies and thus takes the earliest offer at hand.
To provide a simple solution in this regard is to be transparent with the candidate about the timelines upfront. This will set realistic expectations for them as they know what to expect from the process and when.
This can help in slowing or negating the build-up of disinterest in the candidate. This is one of the major staffing challenges faced by any agency.
- Increased Transparency
Moving to the next point on the list of staffing challenges is increasing transparency for the candidates.The majority of the most talented candidates are highly selective and they can be which means that they vet the companies equally as compared to the businesses evaluating the candidates.There are multiple company review websites on the internet like Glassdoor and also job search websites like Indeed feature company reviews along with their job listings. This becomes a challenge for the recruiting companies. Businesses ought to work to make involuntary turnover smooth to the level that it is extremely smooth. The biggest priority of the company is to retain.The employees should be kept engaged and this must be an integral part of the business strategy. This will not only improve the company’s reputation and also assist in attracting the best talent in the industry.
- Unrealistic Employer Expectations
Employers that wish to retain and grow with the top talent working for their organization should have realistic expectations about the journey that would help you achieve the goal.This is another one of the staffing challenges that is a hurdle for the recruiting agency.Here are some of the things that are certain to affect the hiring efforts:
- Lack of the 401k plan.
- Missing benefits like that of medical and dental expenses.
- Denying bearing the moving costs for an out-of-state candidate that has been shortlisted by the firm.
- Inadequate salary offer.
- There is no flexibility at the workplace. For instance, the choice to work remotely, even periodically.
- Lastly, there is a lack of any employee development opportunities or continuing education reimbursement.
According to the reports of Harvard Business Review, this a brief list of the benefits expected by an employee from the job. An organization or employer that denies a respectable wage and does not assist the candidates, or potential employees, achieve a good work-life balance is not attractive for these individuals to choose you from the options they might have.
- Prioritizing Candidate Engagement
The next staffing challenge is to keep the candidates engaged. With the advancement of technology, it has become extremely easy to be in touch with the willing candidates and keep them engaged in some way.Communication channels like email and social media platforms like LinkedIn have also contributed enormously to this aspect.Over the period of time, another form of communication has risen as a mainstream form of communication. It is texting.According to Jobvite, 43% of the millennials see this as an acceptable form of formal communication, 46% of Generation X are fine with it, and 36% of the Baby Boomers comfortably text with the recruiters.So, when you interview the candidate, make sure to ask them if they are comfortable texting. If the answer is yes, congratulations as you have unlocked another way to keep them engaged during the entire process.By switching to this solution, you might reduce one hurdle from the many staffing challenges.
- Recruiting Through Non-Traditional Channels
Another of the staffing challenges is the process of recruiting candidates using non-traditional channels. According to reports by Jobvite, many recruiting agencies and businesses have commenced using social media for the same.Approximately 63% of the hirers are using Facebook and 77% of the hirers are using LinkedIn. Further, these recruiters are also moving to social media platforms like Instagram.This is assisting them in reaching a bigger pool of talent and stand out from their competitors. Roughly 25% of them are using actively using Instagram. Due to this huge shift, even the recruiters are expected to keep up with the changing times.This has led to an increasing expectation of finding talent and connecting to them using multiple online communities like Reddit, LinkedIn Groups, and Slack. It can all been credited to the amount of innovation in this arena.
- Building Brand Culture
If we look at the culture in the corporate world a few years back, it was all about getting the perfect job or the job they always aspired. Currently, the scenario has moved on to find the organization that fits the best.It is about the company and how it relates to the candidate it is short listing. According to a report by Talent Economy in 2018, the millennials, who are expected to constitute a whopping 75% of the workforce by 2025, are eyeing and prioritizing companies that are socially responsible.Further, 64% are of the opinion that if the employer does not align with their values, they won’t take up the job at all.So, if a company culture or values are unclear, negative, or undefined, that is certain to impact the recruitment process for them. Businesses must make a list of the characteristics that are the ideal employees for them and then work accordingly to build a culture that supports this idea.Also, the company must demonstrate this very culture through their website, marketing materials, actions in society, and embody the vision behind the culture using their products or services.All this has become very important as the candidates are taking notes, not only the current generation but also the ones that are expected to join the workforce in the next 5-10 years.
This might not seem like a major challenge today but it is developing to be one of the major staffing challenges.
There is a long list of staffing challenges that exist for an agency or staffing company that is on the journey to acquiring the best fit of a candidate for their clients. All of them have been discussed in detail above.A simple solution to all these problems and hurdles is to face them and upgrade your working styles according to the current trends and expectations of the candidates while holding on to the one set by their clients.It must be very clear that not moving forward in your process will only lead to losing potential clients and the best pool of talent to your competitors. This situation is not suitable for the agency but also is unappreciated on the client’s end.So, walk into the latest solutions with confidence and use them according to your requirements.