Amid turbulent times, successful companies will be the ones that have the talent. However, that talent might not all be human, said John Nurthen, Staffing Industry Analysts’ executive director of global research, during a presentation last week at SIA’s Executive Forum Europe.
Nurthen also highlighted weaknesses that will hold back the workforce solutions ecosystem. For one, the low numbers of women in the audience, which reflect gender imbalance at the executive levels at staffing firms, suggested a “failure across the industry,” he said. Only 30% of the people in attendance were women, he said, adding that more female leaders could help improve the industry overall.
Nurthen discussed several key creators of turbulence staffing firms and their clients can expect in the coming years: technology, the economy, demographics, regulation, geopolitics and the green transition.
Technology. When it comes to emerging technologies, AI, cloud computing, communications and other disruptive tech are set to impact staffing firms and talent acquisition.
Software-as-a-Service, which is part of cloud computing, is expected to have a “very high” impact on staffing services, Nurthen said. Other disruptive tech such as blockchain and quantum computing are also in line to upend the staffing ecosystem.
“Without cloud computing, the staffing business would’ve keeled over and died during the pandemic,” Nurthen said. “We don’t have keynote speakers about cloud computing, but it’s hard to underestimate how important it is.”
Other technology to watch includes 6G and the Internet of Things.
“6G is around the corner. It’s going to improve everything. There will be huge benefits from that,” Nurthen added.
On the Internet of Things, Nurthen said one way it could be relevant is if companies tagged temporary workers to better track their work on a minute-by-minute basis. There could be health and safety benefits, Nurthen said, but added that workers and employers alike may be concerned about the privacy implications of such usage.
The emergence of multi-platforms and the growth of healthcare staffing firms are also trends to watch out for.
Economy. GDP growth will likely be soft going into 2024 and 2025. Across several markets, job vacancies softened in 2023. In terms of staffing market growth projections, the forecast across North America and most European countries is also set to be “limp.” However, APAC is set for strong growth, particularly in China and India.
Overall, Finland is the most attractive staffing market, according to 2022 data.
Demographics. Nurthen added that demographics are favorable as clients will be more reliant on staffing firms and other workforce intermediaries. Furthermore, closing the gender pay gap would improve GDP and create millions more jobs.
Key trends in post-pandemic labor markets include a decline in manufacturing, AI disruption, remote work, increasing female participation, migrant restrictions, aging populations, a rise in self-employment and a rise in contingent work.
Regulation. While regulation will always have an impact on the industry, upcoming global legal trends include AI and privacy regulation, protections for platform workers, temporary staff and casual labor. Furthermore, flexible working and extension of paid leave types, DE&I legislation coverage and pay transparency law expansion are also key trends. Another thing to watch for in the ESG category is supply chain due diligence and whistleblowing.
Geopolitics. Geopolitical risks include ongoing wars and elections which will have an impact on GDP and the staffing industry. There are a surprising number of important elections scheduled in 2024, including in the US, UK and European Union, the outcomes of which could have significant consequences for the global economy. In addition, experts consider energy security, cyberattacks, climate risk and US-China relations to be the biggest risk factors at the moment.
Green transition. Publicly listed staffing firms are having to step up their environmental, social and governance (ESG) reporting given regulatory requirements.
Meanwhile, although most of the world’s largest privately owned staffing firms do not have an ESG policy on their websites, a number are stepping up to disclose these issues given pressure from private investors, clients and their own employees.
Trends to keep an eye on for next year include global legal changes, AI and privacy concerns, platform worker protections, flexible working and paid leave regulations, DE&I legislation, pay transparency law expansions and ESG supply chain due diligence and whistleblowing.
Nurthen concluded that staffing firms can still be successful despite these multiple sources of turbulence and that there continue to be many different routes to success.
SIA’s Executive Forum Europe 2023 conference was held Nov. 29 and Nov. 30 in London.