What Lies Ahead For the Staffing Industry in 2022?

It’s no secret: companies around the globe are having a hard time filling jobs. From fast food workers going on strike over working conditions to older workers retiring earlier than usual, some experts expect that the labor shortage could last for a while. Globally, those talent shortages have hit a 15-year high, meaning that any staffing agency franchise is facing new challenges to fill empty roles.

How many jobs are going unfilled? By the numbers

Three years ago, about half of employers surveyed by Manpower Group’s Talent Shortage Survey reported having difficulty filling jobs. By the third quarter in 2021, that number had risen to more than two-thirds —69% of employers now report having a hard time finding people to work.

As of the end of September, there were 10.4 million job postings in the United States alone, the U.S. Bureau of Labor Statistics reported in its Job Openings and Labor Turnover Summary earlier this month. At the same time, the quits rate—or the number of people who left their job—reached 4.4 million. According to CNBC, that’s the highest rate since December 2000.

Factors affecting the global labor shortage

We’ve all heard about the labor shortage and open jobs. But what’s causing this trend?

Older people are retiring earlier than usual

According to Business Insider, 60% of missing workers in the U.S. have retired. The article notes that research from the Federal Reserve Bank of Kansas City found that the expected number of retirements during the pandemic was about 1.5 million; in reality, that number was almost double.

People who have been out of work aren’t rushing back

Another explanation for some of the missing labor force is that some households have built up savings and aren’t in a hurry back. Maybe a worker had to get a new job out of necessity after their pre-pandemic job closed down, or maybe they were able to take time off and are being selective about the workplace they return to.

Those working in high-demand industries are asking for more

With quit rates reaching a two-decade high, some employees are asking for more pay as they shoulder more work. There is added pressure for employers to do so in order to retain the workforce they have, especially when considering the added impact that turnover has on staff morale and customer satisfaction.

Safety and reluctance to work in-person

Labor Secretary Marty Walsh told Business Insider last month that the pandemic has brought along a new set of criteria for prospective employees. Working in person can come with a higher risk of illness or the necessity of childcare. The need to work away from home also impacted people’s ability to care for their loved ones; the Census Bureau’s Household Pulse Survey heard that 4.65 million people said they weren’t working because they were caring for someone or were sick themselves with coronavirus symptoms.

How can you set yourself apart as a staffing agency?

There is serious demand for tech-savvy recruiters. While that’s been true for several years, the remote and hybrid workplace has made it even more so. Video calls, LinkedIn visits, and sophisticated matching algorithms are now crucial pieces of a recruiter’s toolkit as employees look to be approached on their terms. While staffing agency franchises do provide training programs to help recruiters learn the latest technology, the agencies themselves will have to stay at the forefront of new technology to ensure they’re not being left behind.

Agencies must also understand that there has been a power shift in hiring. For years, it was an employer’s market, where recruiters and human resources professionals had their pick of the litter when it came to hiring. Now, candidates wield a great deal of power themselves—that’s especially true in high-demand areas like manufacturing, sales and marketing, information technology, and administrative and office support.

Labor shortages have hit some industries harder than others. That makes a compelling argument for becoming a niche recruiter. If information technology is one of the five most in-demand industries, then it stands to reason that staffing agencies that focus on IT will become sought after.

Understanding the needs of candidates and employers

Candidates around the globe are making it clear that they want improvement in their lives. Most companies are listening. Now you as a recruiter must cater to what employees in those in-demand fields want the most. According to Manpower Group’s survey, that means things like a better work-life balance, which 80% of respondents wanted, and reimagining the idea of the typical 9-5—almost half of the employees surveyed believe it’s the end of the 9-5 altogether.

Many companies are already working to accommodate these desires to attract candidates. The survey heard that many employers are reinventing their workplaces to be more flexible. According to the results, employers are incorporating:

Flexible start and end times (36% of respondents)

A hybrid work model (31% of respondents)

Flexible or condensed hours (29% of respondents)

Forward-thinking employers are going to have an easier time recruiting and retaining candidates, who are less likely to make compromises or settle in a hyper-competitive recruiting environment.

The Golden Age of recruiting?

While a recruiter’s job is not an easy one, the demand from employers who need to fill jobs is unquestioned. That makes it a great time to get involved in the staffing agency, which has already nearly doubled in the past decade.

Interested in getting involved in a $151 billion industry that’s growing and more in-demand than ever? Please visit our franchise website for more info.