Recruitment industry must not end up as simply outsourced payroll managers warns Consensus

Recruitment agencies may be losing out on the skills and profits that are at the very heart of our flexible labour market, warned construction recruiter Consensus this week. They spend too much time chasing preferred supplier/master vendor and sole agency arrangements instead of applying the entrepreneurial contingency approach to recruitment.

ëEmployersí ability to scale up or down with flexible recruitment plans, making them more agile and able to compete, is often cited as the reason why the UK labour market works so well,í said Alex Downard, business manager at construction recruiters Consensus. ëBut the big bucks these days are in large master vendor agreements where much of the recruitment can be process-driven with account managers managing huge teams and contracts.í

Apart from turning recruitment agencies in to outsourced advertising and payroll agencies it could mean longer-term dire straits for those agencies that breed a generation of recruiters who have never worked on contingency recruitment.

ëWeíre not saying that large contracts donít need special skills or that these opportunities should be ignored,í said Downard. ëItís simply a warning to an industry that appears to be myopic at times in its search of massive contracts - a bit like getting divorced after many years and not remembering how to go on a date.í

If government spending plans or the nature of PFI or local authority recruitment changed, either through a regime change in New Labour or a new government in five years, contingency recruitment would always need to be there, but block advertising and pay-rolling contracts may not, he added.

Recent studies, including one published by the Institute for Employment Studies, are looking into the future of recruitment agencies and concluding that process-driven recruitment such as e-recruitment may pose a threat to recruiters. But itís quite the reverse, says Alex Downard. ëWhile the industry may lose out if employers take e-recruitment in-house - and some agencies may benefit from large contracts - real contingency recruitment seems to be on the up as employers see that thatís where real flexibility is found if they select their recruitment partners wisely.í