During the last few years we have seen the emergence and growth of the on-site recruitment market. Many of the top investment banks and fund managers now have third-party recruiters managing their recruitment processes. This market has now becoming highly competitive, with a number of firms (most associated with mainstream recruitment companies) now able to demonstrate a successful track record in this area. Margins are being squeezed, however, and on-site recruiters are now attempting to increase their product offerings to boost revenues, and lock-in clients.
And many on-site desks now claim to have much more in their toolkits - leadership and talent management products, graduate recruitment expertise, and research and, yes, a search capability. And all for as cheap as chips!
The upshot of all this is that some of the more specialist recruiters (in HR, compliance, audit, risk) are seeing some of their business go first to on-site recruiters, who claim that their expertise will allow them to undertake specialist assignments in an efficient and more cost-effective way. Well, it won't take firms long to realise that you mostly get what you pay for in this world! Proper recruiters needn't worry, then, about being recruiters of last resort for long.
And another thing. The recruitment market is on the move again. The growth of on-site recruitment businesses coincided, in the main, with the downturn in the financial markets industry. Firms were looking at recruitment in terms of saving on costs, rather than hiring quality people. But times are different now. 2005 was the first year that firms boosted profits by increasing revenues, rather than simply by cutting costs. The battle for real talent, in a world more flush with cash, is back on. And some of the large players are already looking at bringing their permanent recruitment back in house again. The larger firms want to regain control of their recruitment processes and establish their own brands more effectively in local labour markets.
So, it might not be too long before on-site desks deal, in the main, with just temps and very junior positions (which is where it all started). What will all those on-site recruiters do then ?