The market for temporary and recruitment staff fell by 5.2% in the year to March 2003 and will only show modest growth in the five years to 2008, according to a new report Recruitment Agencies (Temporary & Contract) Market Report 2003 by Key Note, one of the UKís leading market intelligence providers. However, this follows a period of sharp growth, with the market growing by 52.1% between 1999 and 2002. From a turnover of 14.85bn in 1999 the market grew to 22.59bn in 2002, but has now fallen back to 21.42bn.
ìIt is an industry which thrives during times of high economic activity,î says Simon Taylor, senior editor at Key Note, ìbut it is very vulnerable when the economy slowsî.
A major threat to the market is additional employment legislation, which is giving temporary and contract workers more rights. ìIf employersí responsibility to temporary employees becomes the same as for permanent employees, then one of the major attractions of employing temporary staff will be removedî continues Taylor.
The temporary / contract recruitment market has become increasingly competitive in the last year with a growing number of recruitment companies competing for the same clients, says Key Note. Preferred supplier agreements are becoming more common and certain specialist markets, such as IT, have suffered a reduction in demand. However, temporary employment is now an established part of business life.
Key Note found that less than half the British labour force is in full-time employment. Continual movement of employees between jobs and periodic skills shortages also mean that there will always be a demand for the services of recruitment companies in this market. The number of people interested in and prepared to work on a temporary or contract basis appears to be increasing which means that recruitment companies have a growing number of staff to offer their clients.
Recruitment Agency Market Slowing to Snailís Pace
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