Will Recruitment Agencies Die in the Wake of Business Transformation?

Heidi Gibaut

Heidi Gibaut

July 23, 2020 7 min read

A new report from PwC suggests that 30 per cent of roles across the Channel Islands are at risk due to the digital revolution introducing automation. The paper encourages employers to upskill their current workforce to reduce the likelihood of job loss in the future. With PwC claiming that without immediate upskilling, many jobs lost during the Covid lockdowns will never come back, there is one big question on our minds: Will recruitment agencies still have a part to play – or will their roles become redundant and be replaced by technology?

We have seen huge changes in the way roles are now being undertaken. There is much more reliance on technology, particularly in recruitment services due to the processes of onboarding, induction, training, and managing employment. With new technologies and software becoming available constantly, it’s likely we will start to see a change when it comes to the roles that will be available in the future. This change means that individuals need to consider what skills will be required in future roles to ensure they are the ones who remain employed in the next five years, and what will need to be on their CVs to secure their next job.

In the first wave of automation, a lot of back office roles in Jersey were lost to jurisdictions where labour was cheaper and technology was more advanced. This outsourcing of roles left a large number of individuals who needed to upskill and transfer to new roles. Upskilling the workforce was a huge success as Jersey saw unemployment levels decline to near zero and the island benefited from a full employment status.

However, we must consider whether the Covid-19 pandemic has brought the ‘employment and employability crunch’ closer to creating a second wave of job losses, as suggested by the PwC projection. We should also take into account the scale of this supposed second wave, and if it will be bigger than the last. With the technological advances made of the last 20 years, the effects will be more profound and could last longer. An extended period of job losses is especially likely if it occurs on the back of a pandemic induced recession where many roles have already been lost.

As the first wave reduced the number of ‘entry level jobs’ in the marketplace, new recruits have a higher hurdle to jump over to get their foot on the ladder of a stable career. The introduction of certain technologies in today’s society could see the disappearance of more entry level jobs. Apps to make restaurant and hotel reservations, online food and drink ordering services within restaurants, and even ride sharing apps could all impact the future of low-level jobs due to automation. Organisations now need to take stock of their in-house resources and ensure that their talent management strategies are as advanced as the technology.

Where there are places of work, there are workplace cultures. People being recruited into teams will need to fit culturally, as well as technically, into their new positions. The role of the recruitment specialist is to find the right balance between personality, ability, and potential in candidates to ensure the perfect fit. No algorithm will be able to gauge whether someone has the attitude to learn, continue to upskill, and be passionate about upskilling to further their career.

Currently, many agencies use technology to conduct initial searches for candidates to fill roles that come into their business. However, this initial automated match may not result in the best choice of candidate to manager. Whilst we can expect AI and robotics to replace some functionality, cultural fit is still paramount when aligning the company and individual characteristics of a candidate. Technology can quickly find a match in terms of employment terms and industry, but it will never be able to fully identify the right candidate for the job because there is a lack of connection.

Employers use recruitment agencies as it is through the client’s relationship that a recruitment specialist is able to understand exactly what the employer is looking for, and can convey this to potential candidates. It’s the human touch of recruitment agencies which allow an employer to trust that the time and money spent on a new recruit will result in a decent return in investment.

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Heidi Gibaut

Heidi Gibaut

Managing Director

Heidi is a fellow of the CIPD and excels in matching skills and capabilities along with organisational development. She spent 3 years on the Education and Training subcommittee of IOD and 6 years as policy Advisor for CIPD.

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