RECRUITMENT INDUSTRY'S TURNOVER AT RECORD HIGH OF MORE THAN £26 BILLION, SAYS ANNUAL REPORT
Turnover in the UK's recruitment industry has leapt more than 7 per cent to a new record high of more than £26 billion, the annual industry report launched today (Friday November 2) has revealed.
The sharp increase in industry turnover was one of the principal findings and major milestones in the Recruitment and Employment Confederation's Annual Industry Turnover and Key Volumes Survey 2006/07, published in association with the Recruitment Finance Division of Lloyds TSB Commercial Finance and Recruitment Consultant magazine.
In the period covered in the report - April 2006 to March 2007 - the overall turnover from both permanent and temporary/contract recruitment rocketed to an all-time high of £26.673 billion compared to £24.838 billion in the previous year. The 7.4 per cent growth it represents is the highest increase ever since the report was first compiled in 2001/02.
Commenting on the report, the REC's Director of Research Roger Tweedy said:
"The results show another strong year of growth for the recruitment industry. The findings undoubtedly reflect some of the big issues of the last year: a growing economy, increased levels of labour immigration and the intensifying issue of talent attraction and retention.
"Once again this survey demonstrates the pivotal role played by intermediaries in the UK labour market and will help to drive further recognition for the recruitment industry".
The findings also showed that temporary and contract recruitment was still continuing to grow at a considerable rate rising by 7.4 per cent to £23.2 billion. This represents another strong performance following on from the 6.4 per cent increase to £21.6 billion the previous year.
The survey estimates that the recruitment industry places 1.377 million temporary and contract workers every week. This is an increase on last year but does not reach the peak of 1.516 million recorded in 2003/04.
Of these temporary placements, 22 per cent were in industrial and blue collar posts, 18 per cent were secretarial/clerical and technical/engineering represented 11 per cent.
Offsetting this was the record level in the number of permanent placements which increased a huge 11.5 per cent to a new record level of 787,280. The turnover from permanent business for the same period rose by 7.3 per cent to just over £3.5 billion, which represented 13.2 per cent of total industry turnover.
Of these increased numbers of permanent placements, 19 per cent were in secretarial and clerical, 12 per cent in computing and IT and ten per cent in accounting and financial posts.
There has also been a significant turn in the number of staff employed in the industry. With recruiters slimming down the non-sales areas of their operations, the 2005/06 survey results indicated a 1.6 per cent decrease in the overall headcount to 97,674.
But the 2006/07 survey highlights a 3.6 per cent increase to 101,286 staff. Included in this figure is the number of consultants who work solely on permanent business which has increased dramatically at the expense of those consultants in temporary/contract work.
Average branch sales from permanent business increased slightly over the period to now stand at £232,132 with the biggest gains being made by small multiples with two to nine branches and single operators.
Helen Reynolds, the REC's Acting Chief Executive Officer, said: "The continued growth of the recruitment industry is again a timely reminder of the testimony to the way recruitment is now being seen as a major player within the UK economy and whose prosperity is closely linked with this and most other economic indicators, which continue to stay strong.
"We are also aware of many key trends the within industry labour market, among them the increased employer demand for permanent staff in a tight labour market in which attracting and retaining staff, the so-called 'war for talent,' has become an overriding business priority."
Helen explained it had been a pivotal year for the REC in terms of its pledge to raise standards had been met with great enthusiasm by both its members and also key stakeholders within government and industry circles.
"These figures offer much for us to celebrate in terms of us continuing to reach our full commercial and professional potential, and to be recognised as an industry committed to driving up standards and delivering the best possible service to all."
Paul Saunders, Director of the Recruitment Finance Division, Lloyds TSB Commercial Finance, said: "The strong market conditions we saw in the last half of 2006 and the beginning of this year have contributed to the record turnover.
“This is evidenced by the increased number of temporary placements in computing/IT which can be linked to compliance projects such as MiFID, whilst the 5 per cent increase in demand for technical/engineering temporary workers reflects major works such as Heathrow Terminal 5 and the new international terminal at St Pancras.
“Large scale projects such as CrossRail and the Olympic Games in 2012 will continue to fuel the recruitment industry's future growth. Recent financial market turbulence has not been fully played out and will create opportunities as well as challenges over the next year."
The Report was compiled by the REC's Industry Research Unit. Copies of the Report are available from the REC, www.rec.uk.com/research or by calling Maggie Pattinson on 020 7009 2159.
ends
Major findings of the Annual Industry Turnover and Key Volumes Survey covering the period April 2006 to March 2007 are:
- A record total industry turnover of £26.673 billion compared to £24.837 billion in 2005/06
- This represents a 7.3 per cent increase in overall turnover, the record annual growth rate since the survey was started in 2000/01
- Overall turnover for temporary/contract staff rose by 7.4 per cent to £23.158 billion.
- Total turnover for permanent staff rose by 7.3 per cent to £3.514 billion compared to £3.275 billion the previous year while at the same time, overall share of the market stayed steady at 13.2 per cent.
- Permanent placements increased increased by 11.5 per cent from 706,080 in 2005/06 to 787,280.
- Temporary placements went up from 1,265,060 to 1,377,740
- The temporary/contract share of the total business was 86.8 per cent and permanent 13.2 per cent - no great change on the previous year
- Staff employed in the recruitment industry rose to from 97,674 to 101, 286, an increase of 3.6 per cent
Notes to Editors:
About the REC's Industry Research Unit
The unit was launched in late 2005 with its aim being to offer better research on the UK recruitment industry. Topics covered by the unit so far have included the 2006 Recruitment Industry Census; Managed Services; the Annual Salary and Benefits Survey; the Annual Industry Turnover and Key Volumes Survey plus a 360º Tracking Survey.
About the IRU's Steering Group
The tracking research would not be possible without the leadership and financial support of its members including Adecco, matchtech, Meridian Business Support, Pertemps, Randstad and Vedior.
About the REC
The REC, the Trade Association of the Year, is the representative body for the UK's £26.6 billion private recruitment and staffing industry with a membership comprising more than 8,000 corporate businesses and over 5,500 recruitment consultants. All members must abide by a Code of Professional Practice.
About Lloyds TSB Commercial Finance
Lloyds Commercial Finance has been supplying financial solutions to staffing companies since 1962 and, since the acquisition of CashFriday in 2001, has provided comprehensive back office and payroll outsourcing to temporary recruitment businesses.
By 2007, our market share has grown to 15 per cent and 7 per cent by turnover of the £24.8 billion UK recruitment industry (Source: REC Annual Survey 2006). This enabled use to create a specialist Recruitment Finance Division within LTSB Commercial Finance exclusively serving the requirements of staffing companies. For further information, visit www.recruitmentfinance.co.uk
Published: 02.11.07
E-mail: administrator@recruitmenttimes.co.uk
