Recruitment Process Outsourcing industry is experiencing a tremendous growth according to the executives of two leading RPO companies and the co-founders of the Recruitment Process Outsourcing Association.
Here are the five big trends emerging in the RPO industry, and what RPO executives can take away from them:
- RPO Industry is on the Rise
Mike Mayeux, CEO of Novotus, said that its deal flow in particular is up tremendously. The company is going through a flurry of activity, hiring recruiters and engagement managers in order to keep up with all their new clients. Last September, Novotus’ revenue hit record high. The record was beaten shortly in October. Today, Novotus revenue is 50% higher than the record in September, demonstrating that the rise in the RPO industry is happening very rapidly.
John Younger, President of Accolo, said his company is experiencing similar results. A Valentine campaign that Accolo launched for the month of February, brought in more leads in a couple of weeks than they had for the past three months.
- Low-end of Mid-Market, Engineers, Sales, Mid/Senior Level Coming In
Part of that increase in deal flow is coming from smaller deals from smaller companies, according to Mayeux. Instead of massive deals of million, or multi-million, dollar deals, deals are coming in the form of multiples of $400,000 to $700,000 contracts that are driving revenue and will be driving the RPO industry going forward.
Younger noticed that not only was the lower end of the mid-market coming into RPO, but engineering, sales, and higher level executives as well. Accolo has been working a lot in the digital media advertising. “These companies are going head to head with the “googles” of the world. In order to do that, they have to have a large sales force and they’re turning to us for help.”
- More Newcomers are Engaging in the Process
Mayeux said that it’s these newcomers to the market, who had never heard of RPO before, that are becoming some of the biggest fans of the process. On top of that, these newcomers were once naysayers of the RPO industry, but have become some of the most passionate about the process. This is because the human resource departments of these companies are excited about the help in meeting the hiring needs of the firm.“There’s a ferocity in the market for something different,” Mayeux said. “The status quo is no longer something to buy in.”
- Turnover a Key Factor as Market Improves
A survey from Staffing.org of technology development professionals found that 50% of them would leave their current job as soon as the market improved. This showcases that job growth isn’t necessarily the creation of new jobs and a decrease in the unemployment rate, but changing of jobs if the opportunities arises.
The Department of Labor has a term for this type of turnover: churn. According to the Department, a healthy rate of people voluntarily moving from one job to another is between two to three million. Expect “churning” to make a difference in the RPO industry this year.
- Companies are Implementing Initiatives that Were Once on Hold
“Now as they start to pull the trigger on some of those initiatives… there’s no plausible way to hire that staff with their current game,” Younger said. “They’re turning to us to accelerate those initiatives.”
Overall, the RPO industry is trending in the right direction, with more businesses getting on board with the process and needing help to meet their staffing needs to and to grow. As the career marketing improves, and the economy, so will the RPO industry.