Recruitment During the Recovery

 As the rising unemployment rate starts to decline, RPO shows promise for when companies begin to rebound.

By Michael Beygelman
In July the unemployment rate declined to 9.4%, though an additional 247,000 people lost jobs. At the end of the month the total number of jobs lost since the recession began stood at 6.7 million. Of note is the college-educated unemployment rate—it currently stands at 4.7 percent, which is 50 percent of the national average. In certain geographies and employment segments, it seems there are few—if any—economic problems, whereas in others, the picture looks rather bleak.
Job losses continued to rise in July, but unemployment declined leaving me wondering, how is this possible? As a general rule, when more people lose jobs than obtain new ones, the unemployment rate rises. This was not the case in July, causing some concern and questions as economists dug through the Bureau of Labor Statistics’ most recent jobs report.
One important data point helps clear up the anomaly. The Labor Department also tracks how many unemployed workers are looking for jobs, and in July that number dropped drastically. In fact, more than 600,000 people gave up on their job search. While the reasons are unknown, it caused the unemployment rate to drop slightly. Even though declining unemployment is always welcomed, it’s important to keep this data point in perspective. In the coming months it’s widely anticipated that job losses will likely continue, albeit lower than before, so unemployment will likely react accordingly.
On the Road to Recovery
The focus in HR is now starting to slowly turn to the upcoming recovery, and how organizations might be positioned to deal with last year’s layoffs and cost cutting. How will organizations administer their HR, and most importantly how are they going to attract new talent to help their organizations grow? In terms of recruitment, it looks like RPO might be one of the biggest winners coming out of this recession.
The Black Book of Outsourcing recently published its 2009 RPO research report filled with insight for HR organizations and RPO service providers. The user survey investigated more than 600 contracts held by nearly 2,500 of the top-spending organizations and conglomerate corporations globally. The most important factors identified that influence client satisfaction were: scalability, client adaptability, flexible pricing, marginal value adds, and technology. These “high priority” metrics translate to the fact that companies will need to scale up quickly.
High growth verticals as determined by the more than 26,000 users of the ranking process include these industries: energy, banking and financial services, technology, healthcare, and transportation and logistics. And these verticals will be the first beneficiaries of the economic recovery or the current White House administration’s plans, or both. 
Key findings of the report also include: 91 percent of responding companies indicated they have achieved their desired benefits through RPO; 78 percent of new RPO users say they will continue to use RPO in 2010; 73 percent report cost reduction is the most crucial factor for RPO contracting in 2009-2010; and 66 percent anticipate the need to better manage the recruitment process through external providers. Strong dissatisfaction is uncommon in RPO, occurring in less than 6.6 percent of U.S. clients; 10.3 percent of U.K. clients; and 14.4 percent of international customers.
Economic data coupled with recent employment market data research suggests that the environment for top talent is going to heat up in late 2009 and into 2010. The data also suggests that companies are not well prepared to handle recruitment internally while  RPO buyers are satisfied with the quality and cost of service. 
So how will the RPO industry absorb substantially more customer demand, more sophisticated customers requiring global reach, and service delivery models that will require scalability and flexibility in pricing? Appetite for holistic workforce solutions to help companies scale their enterprise talent needs will drive evolutionary development of RPO service delivery models, and by executing recruitment correctly, companies will be able to quickly attract, find, engage, and retain top talent. That should help ease the unemployment situation and prompt a rebound from today’s economic challenges.
Michael Beygelman is SVP, business development, with Adecco Group North America. He can be reached at

Tags: Consultants & Advisors, HRO Today Global, Professional Contribution

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