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Notes on the New Normal #1 – How is the global private employment services sector shaping up for change?

BLOG – The world of work will never be the same after the Covid-19 crisis, and it is also affecting the private employment services sector and the role it plays in labour markets. Through its Alliance Taskforce, the World Employment Confederation is having conversations with industry leaders around the world to take stock of where the industry is at and where it wants to go. In this blog series, Tom Hadley, the Taskforce’s Project Manager, will explore the key themes emerging from those conversations.

Published on 22nd September 2020

How can the private employment services sector drive post-pandemic economic recovery? How is the industry facilitating a safe return to workplaces and finding new solutions for making labour markets more resilient and inclusive? These are core questions at the heart of the World Employment Confederation’s ‘Alliance Task-Force’ established to take stock of lessons learned and to take a view on what a post-Covid19 world of work might look like.

Our initial round of conversations with national federations and industry leaders from around the world has already provided an initial stock take of where the industry is at and where it wants to go.  Some early messages from this ‘big conversation’ are as follows: ​

  1. The crisis has underlined sectoral and regional differences – Sectors like logistics and health have shown strong demand. In some countries, temporary staffing is still predominantly associated with blue collar sectors. How to demonstrate the benefits of using intermediaries in highly skilled sectors like IT and engineering is a priority for some national federations. Pre-empting future skills needs and growth sectors is a huge opportunity for the sector. ​
  2. The private employment services sector is facilitating the back to work process – This includes a specific focus on ensuring temporary staff are protected. National federations and global recruitment businesses have developed new expertise on health and safety issues and built links with specialists in this area. This ties into the agenda of providing broader HR services, strategic support and added value.​
  3. Flexible working arrangements are more important than ever – At a time of extreme uncertainty, agile workforce solutions provide a crucial outlet. The intensifying unemployment challenge is also driving national governments to engage positively with the sector. Specific data points – such as the fact that 3 out of four people working through an agency in Chile were previously unemployed or working in the informal economy – will fuel further recognition. ​
  4. New sources of competition are intensifying in the workforce solutions space – Online platforms and recruitment apps have been flagged as a source of current and future competition. This is not a new concern, but an increasing number of sectors are being targeted. Providing increasingly valuable services to employers and workers is the best response. The priority going forward is also to provide clear differentiation between different sources of flexibility in the eyes of policy makers and the wider public. ​
  5. The private employment services industry must be at the forefront of jobs market ‘reboots’ – The sector is already working with national governments to facilitate transitions and support job-seekers. Taking a lead on re-skilling and in-work progression is an opportunity for the industry. Building on the ‘social innovation’ strand of WEC activities is a way to capitalize on this. ​
  6. The private employment services sector should take a lead on inclusion – Boosting equality and diversity through inclusive recruitment is an opportunity for the industry to demonstrate its role in making change happen on a priority area for policy makers. The focus on boosting diversity in senior roles which presents specific opportunities for the executive search community. ​
  7. Business models will evolve in the New Normal – Providing added value and more strategic workforce support has been a common theme. Will the industry be competing against established HR consultancies in the New Normal? Possibly. New business models may also emerge for flexible workforce arrangements – for example, agencies placing staff on fixed-term contracts with end-users for longer-term assignments. ​

Over 57 million people a year are placed into work by private sector employment agencies globally. As well as continuing to play a leading role in facilitating a safe return to workplaces, the global industry will be at forefront of addressing intensifying employment challenges. Showcasing this contribution is a priority for the World Employment Confederation and for national federations as we head into the uncertain terrain of the so-called New Normal.

This post is a first of a series where we will explore the key themes that emerged from the conversations with national federations and corporate leaders within the Alliance Task Force. The series is signed by Tom Hadley, an external advocacy and campaigns consultant and former Director of Policy & Campaigns at the REC, the professional body for the UK’s recruitment and employment industry. He is currently leading the World Employment Confederation’s ‘Alliance Task-force’ project.

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