By 2020, millennials would account for nearly half of the global workforce. Over the next five years, millennials are tipped to trigger the growth in temp-related jobs. In the coming years, several other factors, including economic downturn, requirements for specialized skill sets, demands for a flexible workforce, and the chances of getting permanent positions are likely to boost the temp labor market.
Impacts of the Past
In the U.S. alone, driven primarily by healthcare reforms, the temp staffing industry added nearly 1.24 million new jobs (12.3 percent of all jobs created in the private sector) since the recession. The ACA (Obamacare) finally materialized last year and had a notable impact on staffing firms, pushing them to increase their markup rates and pass on the additional costs to customers. The situation is expected to be more intense in 2016 with an increase in regulatory pressures. The advent of flexible workforce is likely to drive the need for integrated human capital management systems, popularly termed as total talent management, among HR sourcing managers.
Skills shortage will be a challenge in 2016, with one in four hiring managers planning for openings related to STEM (Science, Technology, Engineering & Math) in the coming year. Talent shortage surveys indicate that recruiters are facing difficulty sourcing specific talent groups, including engineering and skilled trades. Demographic shifts will emerge as a key concern for many enterprises, with many countries encountering a stagnant or shrinking labor force.
There are is also a significant rise in demand for technology upgradation across the industry, especially in terms of expense tools. This requires huge investment in technology and state-of-the-art IT infrastructure which only a certain set of players would be able to comply with. Compliance and information security are pegged to receive limelight with organisations and governments giving priority to regulatory standards in 2016.
The Way Ahead
Online staffing and crowdsourcing will witness strong growth, driven by the increasing role of technology in employee engagement. Talent sourcing managers must explore online labor exchanges, such as Elance and Freelancer to tap into highly skilled lower-cost resources, virtually on-demand.
There is also an emerging concept of “enterprise-workforce-as-a-service,” or eWaaS, which simply involves “dialing up” talent when needed. Using innovative hiring platforms, such as Elevate Direct and People Per Hour, recruiters can search for and interact directly with prospective hires.
To read more forecasts on key categories and commodities, download your complimentary copy of the GEP Procurement Outlook Report 2016.