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What’s the Future Hold for Direct-Hire Placements?

by | Jun 24, 2010 | Recruiter Training, Top Echelon Blog

There’s no doubt that the most recent recession (or current one, depending upon who you talk to) was much different than previous ones.  As a result, it stands to reason that the recovery will be much different, as well.  According to a recent article (“Say Good-Bye to Full-Time Jobs With Benefits”), those who work a full-time job in the future may count themselves among the minority.

The article indicates that many of the jobs that employers are currently adding are temporary or contract positions, as opposed to full-time jobs.  The reason?  Plain and simple: to cut costs.  Companies are looking at any way possible to cut them, and this is one of the ways in which they’re accomplishing that goal.

The trend is an interesting one, to say the least.  According to the article, five years ago the government estimated that 31% of people in the marketplace worked on a contract (or “contingent”) basis.  Furthermore, analysts predict that number could increase to 40% by the end of the decade.  After that?

James Stoeckman of WorldatWork told that within the next 20 to 30 years, full-time employees could become the minority in the nation’s workforce.  That means that more than 50% of all employees would be working on a contract or temporary basis.

Is this a short-term trend?  Or a long-term phenomenon?  Is the U.S. economy in the beginning stages of a massive paradigm shift in terms of hiring and staffing?

More importantly… what does all of this mean for recruiters?

Let’s say, just for argument’s sake, that Stoeckman is correct and by the year 2030, more than 50% of all employees in this country work on a contract basis.  If that’s the case, wouldn’t that mean there would be fewer direct-hire job orders than there are now, and certainly fewer than what existed five years ago?  Would employers look to fill their open positions on a contract basis first, making a full-time hire a secondary consideration?

If less than 50% of all job orders in 20 years are direct-hire job orders, how many more job orders overall would have to exist for there to be the same number as now?  And how many more recruiters will be working in the industry in 20 years?  Even if there is the same number of direct-hire job orders, will there be the same number of recruiters vying for those orders?

And why the heck do I keep asking so many questions?

Probably because I don’t have many answers.  All of this is theory and conjecture at this point.  What will happen for sure is anybody’s guess.  However, it appears there’s at least a chance that eventually there will be more contract employees in this country than full-time employees… which means there’s a chance there will be more contract job orders than perm job orders.  A few years ago, the possibility of such a scenario was inconceivable, not even on the radar in terms of future trends.  Now, for some prognosticators, it’s more than a possibility–it’s an inevitability.

What are your thoughts?  Are your clients looking to fill more contract and temporary positions right now than they were five years ago, or even two years ago?  Is the whole notion that direct-hire positions (and placements) are destined to decline a misguided notion?

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