What is the Future of the Staffing Industry?

June 6, 2019

It was an action-packed year in 2018 for the staffing industry, and with our growing economy, it doesn’t look like it is going to slow down anytime soon as we move through 2019. The most significant changes and challenges that dictate what the future of the staffing industry holds is an increase on spending for technological advancements, talent shortages, meeting payroll, and the growing importance of Artificial Intelligence (AI).

 The Highlights of the Staffing Industry

• According to the Bureau of Labor and Statistics, nearly 263,000 jobs were created in April 2019, and the unemployment rate dropped to 3.6 percent.
• The Staffing Industry Analysts (SIA) reports a 4% growth in the US staffing industry this year and predicts that the US staffing industry will reach $157.8 billion in revenue next year.
• Most staffing agencies think that there will be increases in hiring, billable hours, and temporary placements.
• The American Staffing Association forecasts that there will be a lot of opportunity for job seekers in temporary, contract, and permanent employment as healthcare expands and the use of technology increases.

Top Concerns for the Staffing Industry

• Staffing industries are having a difficult time meeting demand for qualified candidates. As a result, it is impacting staffing firm’s growth strategies.
• According to a staffing industry survey published by Bullhorn, list pricing pressure and margin compression were selected as being one of the top three challenges of 2018. This concern is stemmed from the expansion of Vendor Management Systems (VMS). However, mid to large size firms expect their percentage of VMS business to increase.
• Staffing agencies are feeling pressure in being able to leverage technology and automation.
• There is some uncertainty over what the economy holds and future growth.

 

How Technology is Impacting the Staffing Industry

Technology is ever-changing and advancing; this is good news for the future of the staffing industry, even if some firms view it as a challenge. There has been a lot of positive conversation amongst staffing firms in regards to digital platforms such as Wonolo, Workpop, moonlighting, etc. According to Undercover Recruiter, staffing firms expect an increase in tech spending by over 52% in 2019.

The push to implement automating and accelerating and recruiting and placement processes ranked high on the list of priorities this year as well as being one of the biggest business challenges according to Bullhorn. Automation alleviates a lot of the time-consuming manual steps allowing technology to take over. Staffing firms can use automation tools to set up custom triggers and activities when online applications are submitted through their Portal. More over, freeing up employee time to be spent on maintaining and building customer relationships and finding quality candidates.

Artificial Intelligence is Beginning to Surface

Artificial Intelligence (AI) is the future of the staffing industry. Traditional methods for talent searches still require employers and HR professionals to perform the long, extensive task of examining each application by hand before calling in candidates for an interview. Intelligent staffing and management AI removes that task. AI recruitment platforms are highly sophisticated and create algorithms based off of neuro-linguistic and machine learning. Once the algorithms have been generated, the AI platform can act as a digital recruiter, recognizing employer requirements and identify which potential candidate best matches the employer’s criteria.

Meeting Weekly Payroll

One of the biggest challenges staffing agencies face is meeting weekly payroll. Payroll funding for staffing agencies provides consistent cash flow that growing companies need. When timing is critical, waiting two or three weeks for the cash you need doesn’t get the job done. With payroll funding, you’ll have the money you need to use towards technological advancements, supplies, payroll, or whatever else is required to keep the company growing.

Since 1994, TCI Business Capital is ranked as one of the top payroll funding companies. We have years of industry experience in working with staffing firms. In addition to offering reliable cash-flow solutions, we provide credit analysis and risk assessments, treasury services and online reporting, and AR Management. We want to see companies succeed!

To speak to one of our financing experts or get a quote on payroll funding services for your business, call (800) 707-4845, or fill out the contact form below.