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SIA research can elevate your programs

As the new year approaches, workforce solutions experts are thinking of ways to move their programs forward. Here are a few helpful SIA reports as you venture into 2017.

Need more talent? Take a look at our 2016 Staffing Firm Market Share Landscape and Book of Lists – North America Edition [1] to discover suppliers you may want to add in 2017. This list (by market share) is the most comprehensive anywhere and covers:

We also studied buyer satisfaction with staffing suppliers as well as VMS and MSP providers from a net promoter perspective. The results can be found in our Workforce Solutions Buyers Survey – Satisfaction with Staffing Supplier VMS MSP and Advice to Staffing Firms [2] report, which also ranked the importance of cost, quality, efficiency and risk in evaluating staffing suppliers.

Quality of workers supplied was rated extremely important by 63% of respondents in evaluating staffing suppliers. This was followed by Risk (e.g. legislative compliance, level of indemnity, intellectual property protection, etc.) at 44%, with efficiency next at 37% and cost at number four (31%) was last. Not surprising as companies have widely learned how to control cost and are now more concerned with quality of work, mitigating risk and efficiency of engagement as the quest for talent becomes more competitive, especially in the professional services arena.

We also asked companies: “How likely are you to recommend your organization’s primary staffing supplier/VMS/MSP to a friend or colleague?” Survey results indicate that VMS and MSP has shown a decreasing trend in Net Promoter Score (NPS), while the trend for staffing suppliers has been less apparent. How can staffing firms improve buyer satisfaction? Increase quality of workers provided, understand client needs, and have a strategic partnership with data visibility. Interestingly enough, the topic of cost savings was only mentioned in 8% of comments.

Program managers can use this report to look at how you rank your satisfaction against others in the business. You may want to share this information with your staffing providers and other providers of workforce solutions to help them understand your perspective as their customer.

Cost is always important, and we have two sources to look at it for 2017: the Staffing Company Survey 2016: Direct Hire Fees [3]  and the Gross Margin and Bill Rate Trends [4].

In the latter report, we asked 16 publicly traded staffing companies what the gross margin was for the business they do in the United States. In 2015, gross margin ranged from 15.2% to 41.5%, with an average of 24.8% and companies with more direct hire business were likely to have higher gross margins.  This report calculated that average gross margin expanded in 2015 from 2014, but remains below pre-recession levels and as of 3Q16, 11 of 16 companies reported a year-over-year decline in gross margin. One reason margins are generally not back to pre-recession levels (2007) is that the direct hire market (unlike the temporary staffing market) has still not recovered to pre-recession levels.

When our researchers looked at the Producer Price Index released by the US Bureau of Labor Statistics they indicated year-over-year increases in the bill rate for temporary staffing of industrial workers were trending in the range of 4.5% to 5.1% throughout 2016. After declining to 0% in the first quarter of 2016, office/clerical bill rate growth has since spiked and is currently rising at an annual rate of 4.5%.

Looking at cost when it comes to using direct hire placements? Our Staffing Company Survey 2016: Direct Hire Fees [3]  might be of interest to you too. We asked 269 staffing firms that participated in our survey and found that the median direct hire fee was equal to 20% of salary, this finding was fairly consistent across staffing firm types.

Whether you need to find more suppliers, see other buyers satisfaction with staffing suppliers or get insight into temporary staffing bill rates or direct hire fees these reports can help. These reports are fully available to our CWS Council and Corporate members, if you need access or would like to find out about how to get access just let us know. Have a healthy, happy and prosperous 2017!

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