Receive daily articles & headlines each day in your inbox with your free ERE Daily Subscription.

Not logged in. [log in or register]

Recruiters: Your Days Are Numbered

by Dec 10, 2012, 6:04 am ET

Recruiting can be boiled down to three critical ingredients that make up the mix: sourcing, screening, and verifying. A traditionally manual function of HR, process automation is snatching the reins from bloated HR divisions and outside recruiters.

According to Bersin & Associates, spending on outside recruiters represented a third of recruiting budgets in 2010; however, due to high commissions (averaging 21% of a new hire’s first year salary), spending halved in 2011 in favor of sourcing talent directly on social networks.

Of course, fancy recruiting IT is imperfect and can not (yet) replicate the intangibles of a seasoned recruiter. Plus, someone has to pilot the software — push the button, as it were. But make no mistake, the tech industry is going after 100% of the pie. And that means cutting out the middleman.

We’re already seeing signs of disruption.

For example, dedicated social recruiting tools such as BranchOut, Jobvite, and HireRabbit are shifting the responsibility of recruitment away from recruiting professionals and toward company employees, who get rewarded for connecting their networks to their employers. In effect, recruiters are being marginalized by collaborative filters within large networks of engaged users.

HR associates are also at risk. From the business owner’s perspective, every hour spent on payroll, benefits, compliance, workers’ comp. etc. is an hour lost on delivering value to customers. So more businesses are outsourcing — not just the HR function but their entire workforce — to professional employment organizations such as ADP.

Recruiters: Billions in venture and acquisition capital is being poured into enterprise software — HRMS, HRIS, HCM, ATS, and other acronyms associated with your future paycheck. Silicon Valley snuffed travel agents a decade ago. Will you suffer the same fate?

Look around the corner and you’ll see that the Heidrick & Struggles of tomorrow is more data analytics than corporate politics. More technician than tactician. LinkedIn “seats” will be filled by computer-science degreed derrières. Recruiting as we know it — a scrappy and gut-driven racket — has reached its expiration date.

 

photo from Bigstock

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  • Ken Goldman, CPC

    I just think it’s funny how much time some of my fellow recruiters have to post comments. Shouldn’t we be on the phone?

    Just sayin’………

  • http://www.linkedin.com/in/michaelspiroprofile/ Michael Spiro

    One thing that I don’t think has been addressed in the multitude of great comments here is the basic validity of the “statistics” upon which this entire article was based:

    “According to Bersin & Associates, spending on outside recruiters represented a third of recruiting budgets in 2010; however, due to high commissions (averaging 21% of a new hire’s first year salary), spending halved in 2011 in favor of sourcing talent directly on social networks.”

    Spending HALVED in one year????? I find that very hard to believe. How was that data collected? What was the size and makeup of their sample? Polls like this are notoriously biased and inaccurate. (Just look at how wrong the pollsters were during the recent presidential election!) And even if the total spending on outside recruiters actually did drop significantly, how can one fully attribute that drop solely to “high commissions” or to companies shifting from using outside agencies to internal sourcing through social networks. Couldn’t the economic downturn of the last few years, the unstable stock market, or a drop in hiring in general have anything to do with that lowered agency spending???

    It seems to me that this article might have simply drawn the wrong conclusions by blindly accepting very unscientific, inaccurate data to begin with.

  • Keith Halperin

    @ Michael: Hear, hear!
    Besides questioning the validity of statistics (for the reasons Michael wisely gave), we should also question the neutrality/objectivity of the source- i.e., does the originator of the statistics simply wishing to find out something, or do they have something to gain from their surveys results?

    There are at least two other things of this type we should question:
    1) When someone claims their own experience as the basis for objective truth: e.g. “More than 250 clients over 20 years have been satisfied, therefore what I say is is true.”
    The plural of “anecdote” is not “data”.

    2) Even worse is when someone, believing their own hype, proclaims themselves an authority and makes a pronouncement as “the truth” simply based on their own opinions, without supporting evidence.

    Fortunately, we never have any authors on ERE who do things remotely like these last two descriptions….

    Cheers,

    Keith

  • Lisa Zee

    @Lior, is this an attempt to make friends? The people you are trying to sell your apps to are the very people offended by your comments. Recruiters may work for an agency today but tomorrow they are corporate recruiters. Are you aware that CEOs/Managers actually rely on their advisors (HR and Recruiters) to tell them which tools/apps are worthy? Make friends, my friend.

    As for ‘expiring’ recruiters, the day someone invents a button that can build ‘trust’ between humans will be the day recruiters worry about loosing our livelihood. As long as companies continue to hire humans, the function of recruiting and recruiters will continue to add value and survive.

  • Keith Halperin

    @ Lisa:
    With friends like recruiters, who needs enemies? ;)

    “CEOs/Managers actually rely on their advisors (HR and Recruiters) to tell them which tools/apps are worthy” Oh, that explains the incredible amount of terrible tools and apps which are foisted on us. I thought it was due to well-healed sales people talking to Staffing Heads (who rarely if ever seem to have to use what they’re buying) into getting something with virtually no input or buy-in from those of us who actually do the recruiting work.

    Trust? “Trust but verify”. Trust candidates to look after their own interests (just like the people at the top do), and work to make those interests coincide with what we want them to do: accept the job under our conditions.

    Cheers,

    Keith keithsrj@sbcglobal.net

  • Keith Halperin

    @ Lisa:
    With friends like recruiters, who needs enemies? ;)

    “CEOs/Managers actually rely on their advisors (HR and Recruiters) to tell them which tools/apps are worthy” Oh, that explains the incredible amount of terrible tools and apps which are foisted on us. I thought it was due to well-healed sales people talking to Staffing Heads (who rarely if ever seem to have to use what they’re buying) into getting something with virtually no input or buy-in from those of us who actually do the recruiting work?

    Trust? “Trust but verify”. Trust candidates to look after their own interests (just like the people at the top do), and work to make those interests coincide with what we want them to do: accept the job under our conditions.

    Cheers,

    Keith

  • http://www.argussearch.com Patrick Pettengill

    I just posted this comment on LinkedIn and decided it would be best if I posted it here where the original posting came from:

    This article strikes me as akin to a Yahoo news post. It is shallow on the facts, ignorant of the profession and overly enamored by technology for technology’s sake.

    The “art” of recruiting is so much more than this pithy article tries to espouse.

    Recruiting is both an art and a science where professional recruiters, acting as agents for their customers, engage with, build relationships with and attract the ‘best available’ talent. A good recruiter does not simply “Match” buzz words in a search string, they “engage” talent in a courtship. This courtship is two sided: The one side in support of their client’s best interests and the other, in support of the candidate’s career choices.

    While technology is sprouting up that allows the recruiter to more readily find, reach and engage with talent – technology CANNOT become a partner with the talent or the client.

    I have been recruiting for 33 years now and trust me – having the LinkedIn’s and Jigsaw’s of the world to help find and engage talent along with the likes of Bullhorn and BigBiller et al to help manage those relationships – Well, they have not only NOT put me out of business, they have made me a more productive and successful recruiter.

    Here’s to technology!!

  • Keith Halperin

    @ Patrick:”It is shallow on the facts, ignorant of the profession and overly enamored by technology for technology’s sake.”

    Patrick, what you’ve described is in the *very best tradition of most ERE articles.

    Cheers,

    Keith

    *You left out “self-promoting” but that’s already been covered…

  • Keith Halperin

    @ Patrick: “It is shallow on the facts, ignorant of the profession and overly enamored by technology for technology’s sake.”

    Patrick, you just described what’s in the very best tradition of most ERE articles.

    Cheers,

    Keith

    “You left out self-promoting, but that’s already been covered.

  • Matt Hoffman

    Lior,

    I’ve pasted the gist of your resume below. What, other than a mind-blowing example of hubris, could possibly make you think you have profound thoughts to offer on anything other than promotion or self-promotion? You’ve had a 9 year career in marketing and business development. Excuse me (and anyone else with even a slight dose of skepticism and commonsense) if I don’t take your professional word for it…

    Marketing & Business Development Consultant
    VibeDeck
    September 2010 – May 2012 (1 year 9 months)LA / London

    Marketing & Business Development Consultant
    Audiolife
    September 2009 – December 2010 (1 year 4 months)LA

    Marketing Director
    MyDrifts
    July 2008 – May 2010 (1 year 11 months)Tel-Aviv

    Content Manager
    VIRV TV (RayV)
    August 2007 – August 2008 (1 year 1 month)Tel-Aviv

    Website Manager
    We Are Listening
    November 2004 – August 2008 (3 years 10 months)London

  • Keith Halperin

    @ Matt: Once again I mention- being familiar with (or better yet actually DOING) what we do isn’t a requirement of writing articles here on ERE. Almost every week we get pious pronouncements, “gee-whizz” predictions, and self-promoting infomercials and advertorials largely from people if they ever did work as contract or corporate recruiters, haven’t been for quite awhile and don’t seem to have much of an understanding of the way things are for many/most of us, but by and large, we give THEM a pass… Is it because Lior is new to the game?

    Finally, all you Lior-haters: if you think it’s so easy to write an article, well then YOU write one. (Notice how many articles I write? It’s much easier for me to tear apart other people’s articles and comments than write an article of my own….)

    Keith

  • Matt Hoffman

    @Keith: If that’s the case, I have no use for ERE. Once upon a time, we lived in a pre-social-media, self-branding world where people would never dream of so brazenly commenting on something they knew little or nothing about. My comment didn’t stem from Lior being “new to the game”, it came from me being new to ERE and unaware of this particular faulty game.

    It’s not at all difficult to write articles, Keith. That’s the very reason that know-nothings like Lior write them. All you need is a cursory grasp of the English language and a void of shame to get over the fact that you’re packaging useless thought as expertise. There’s very little downside to writing them, too. All you stand to expose yourself to is a bit of criticism like mine but, at the same time, you’re building your brand — which is exactly what Lior is out to do.

  • Keith Halperin

    @ Matt: I’m sorry you feel that way. “Once upon a time, we lived in a pre-social-media, self-branding world where people would never dream of so brazenly commenting on something they knew little or nothing about.” When and where was this “Golden Age” before the time when some people are saints, some are scoundrels, and most of us somewhere in between?

    As Moliere said in “The Misanthrope”:

    PHILINTE:
    Come, let’s forget the follies of the times
    And pardon mankind for its petty crimes;
    Let’s have an end of rantings and of railings,
    And show some leniency toward human failings.
    This world requires a pliant rectitude;
    Too stern a virtue makes one stiff and rude;
    Good sense views all extremes with detestation;
    And bids us to be noble in moderation.
    The rigid virtues of the ancient days
    Are not for us; they jar with all our ways
    And ask of us too lofty a perfection.
    Wise men accept their times without objection,
    And there’s no greater folly, if you ask me,
    Than trying to reform society.
    Like you, I see each day a hundred and one
    Unhandsome deeds that might be better done,
    But still, for all the faults that meet my view,
    I’m never known to storm and rave like you
    I take men as they are, or let them be,
    And teach my soul to bear their frailty;
    And whether in court or town, whatever the scene,
    My phlegm’s as philosophic as your spleen.”

    Cheers,
    Keith “I Should Try to Be More Like That” Halperin

  • Matt Hoffman

    Great reply, Keith. My comment went a touch too far and the poem is apt. Toning down the ire, my point is that, generally, we’re too ready to offer opinions and we’re over-exposed. I’m not idealizing the past — I’m idealizing the distance that existed between us before technology and connectivity killed our empathy.

    I guess the proper response to Lior’s post would have been to queue up an article warning that Entrepreneurs’ Days Are Numbered as we’re all tired of all the tech startup talk and we no longer trust these bold, enterprising sorts to do anything more than apply a bit of smoke and mirrors to create the perception of value, do everything in their power to successfully launch an IPO, fleece thousands of initial investors, watch the stock tank as newly minted mill(bill)ionaires, etc, etc.

  • http://www.hlsboston.com Joe Madden

    Couldn’t agree more with Nick C’s comment. Good recruiters that last though the economic ups and downs do just that, recruit. This latest wave of internal ‘recruiters’ (btw – please…you’re not even close, so stop using the title) will ease back into their HR chairs once they get over the fact that they dont run a desk anymore, and will thankfully let us do our jobs.

    ERE’s been courting the HR/Internal Recruiter side of the business for years, so this guy’s article shouldn’t surprise anyone. The guy before him said Monster was going to wipe us out, and he came after the guy that said the same thing about the fax machine.

    If we stick to finding the candidates our clients ask us to find, we’ll all be fine.

  • Keith Halperin

    Thanks, Matt. Well-said. I say this more and more frequently:
    I fear that the hype in recruiting will continue as long as there are slick hucksters with high-level connections ready to sell the latest recruiting snake oil or “magic bullet” to desperate and not-yet insolvent recruiters and their superiors who fail to recognize that in most cases they are futilely “rearranging the deckchairs on the Titanic” of their companies’ ill-conceived, over-blown, grossly-dysfunctional hiring practices.

    Cheers,

    Keith

  • Pingback: Dawn of the Passively Active Candidate | ConnectedSearch

  • Sridhar Iriventi Ism

    This article is like saying doctors are not required as there are database of diseases, symptoms and medicines just send a query you know the cure approach or like Investment bankers are not required as analytical tools are available. Yes transactional recruiters will face a challenge. But the maze created by technology overloads of HRIS, ATS, Social networks etc can only be unknotted by minds who understand the context of recruiting. Its a science. Lets not ignore the value of scientists because we have plethora of scientific tools.

  • http://www.ere.net/author/lior-shamir/ Lior Shamir

    @Sridhar – That’s a poor analogy. The barrier of entry into the recruitment profession is relatively low compared with the barrier of entry into medical science. In practice, many managers make accurate and successful hires without the aid of a recruitment expert. In contrast, the average person can not accurately diagnose and treat an illness (e.g. clinically assess, prescribe drugs and monitor progress).

  • http://www.linkedin.com/in/michaelspiroprofile/ Michael Spiro

    Regarding Sridhar’s comment: I think recruiting is actually not so much a science as an art. By that, I mean that subjective, people-oriented decisions made by recruiters who actually talk with and meet potential candidates often determine who best fits or doesn’t fit a particular opportunity. A person’s resume (experience, skills, etc.) is only one part of the puzzle. Matching is something best done by actual human beings — not by computers or software. All of those “scientific” tools (“HRMS, HRIS, HCM, ATS”) as well as Social Media sites merely gather and organize the data. It’s the fine art of interpreting that data, along with evaluating the subjective and often intangible “people” factors, that keeps good recruiters in business.

  • Richard Kolikof

    Though I have not read all comments on Mr. Shamir’s article, I would like to add a couple of things I don’t think people mentioned. It is true; to find excellent quality talent, you must recruit passive candidates. These are people who are happy at what they do and have not made any efforts to enter the job market. So, Mr. Shamir suggests an automated system where the manager would make first contact. Managers making a cold call without a resume and intent on being recruited, except you have to convince the passive candidate to consider making a move from a job he/she enjoys to another enterprise. Do not see the skills inherent in many hiring managers. And one more thing, judgement is key as a recruiter. If I was sourcing and saw Mr. Shamir’s profile, I would pass. Too many job hops the last 5-6 years. I have clients who would not consider. A software might.

  • http://hrthebottomline.blogspot.com/ Nancy Robin Gillman, MBA, SPHR

    I think this started happening about 5-10 years ago. Result: wrong people in the wrong positions resulting in dysfunctional companies and economic turmoil.

  • Pingback: Social Recruitment – The End Of The World As We Know It? | Douglas Jackson Executive Recruitment Consultants for Call Centres & Customer Services

  • Pingback: Technology’s Impact on Executive Recruiting « Wanted: Critical Skills!