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On-hire placements up, but margins "squeezed": RCSA
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On-hire placements up, but margins "squeezed": RCSA
On-hire placements now account for 96 per cent of recruitment but revenue hasn`t increased in line with the rise, showing margins are being squeezed, the RCSA`s latest quarterly member research says.
As at May, recruitment companies participating in the survey reported that permanent placements made up just four per cent of their recruiting activity (down from 5%).
Participating companies made an average 68 permanent full-time placements in the quarter, down from 86, while on-hire employment and contracting nearly doubled (up to 1,790 from 915 in February).
The proportion of revenue from on-hired employment, however, rose just two per cent (to 52%) over the same period, indicating that "margins appear to have been squeezed". (Permanent placement revenue declined by two per cent to 37 per cent.)
Despite on-hire placements now forming the lifeblood of the industry, some 15 per cent of agencies (27 in total) have no on-hire workers or contractors on their books, the report shows.
Signs of optimism
Business confidence and expectations of growth have risen slightly from the past quarter, the survey found.
Nearly half (49.8%) of CEOs, owners and managers surveyed are confident that business conditions will improve over the next three months, up from 44.5 per cent in February. The rate of expected change - at one per cent - is small but positive.
The state of the economy remains the number one concern for the industry, with 94 per cent of respondents highlighting this issue.
Next up is clients` lack of hiring intentions (91%, up from 88%), followed by maintaining profitability and fee levels (86%, up from 83%).
Price under-cutting in the industry is slightly less concerning than it was last quarter - nominated by 75 per cent of respondents. ....
Source:
http://www.recruiterdaily.com.au/nl06_news_selected.php?act=2&stream=All&selkey=
As at May, recruitment companies participating in the survey reported that permanent placements made up just four per cent of their recruiting activity (down from 5%).
Participating companies made an average 68 permanent full-time placements in the quarter, down from 86, while on-hire employment and contracting nearly doubled (up to 1,790 from 915 in February).
The proportion of revenue from on-hired employment, however, rose just two per cent (to 52%) over the same period, indicating that "margins appear to have been squeezed". (Permanent placement revenue declined by two per cent to 37 per cent.)
Despite on-hire placements now forming the lifeblood of the industry, some 15 per cent of agencies (27 in total) have no on-hire workers or contractors on their books, the report shows.
Signs of optimism
Business confidence and expectations of growth have risen slightly from the past quarter, the survey found.
Nearly half (49.8%) of CEOs, owners and managers surveyed are confident that business conditions will improve over the next three months, up from 44.5 per cent in February. The rate of expected change - at one per cent - is small but positive.
The state of the economy remains the number one concern for the industry, with 94 per cent of respondents highlighting this issue.
Next up is clients` lack of hiring intentions (91%, up from 88%), followed by maintaining profitability and fee levels (86%, up from 83%).
Price under-cutting in the industry is slightly less concerning than it was last quarter - nominated by 75 per cent of respondents. ....
Source:
http://www.recruiterdaily.com.au/nl06_news_selected.php?act=2&stream=All&selkey=
