CareerXroads Survey: Agency Placements Took Big Jump In 2013

Evidencing the increasing difficulty of recruiting quality talent for key positions, employers turned to search firms to fill more of their openings last year, nearly doubling the percentage of jobs filled by independent recruiters from 2012.

The 50 employers, some with more than 200,000 workers, who took part in the just released source of hire survey by the recruiting consultancy CareerXroads, reported filling 5.9% of their external opening with candidates from third party agencies.

It’s the largest agency share since CareerXroads began asking about third party placements in 2003. That year, employers attributed 1.2% of their external hires to agencies. In 2012, employers said 3.1% of their hires came from agency referrals.

The big jump may be explained by the shrinking pool of educated, skilled workers. In January 2012, the unemployment rate for workers over 24 with a college degree was 4.3%, a rate identical to January of the year before. By January of 2013, the unemployment rate for this group had fallen to 3.8%. Last month, the unemployment rate for the college educated was 3.3%.

One other factor may be helping up the number of job orders being turned over to search firms and independent recruiters. A higher percentage — 58.1% in 2013 vs. 54% in 2012 — of the jobs at the companies in the CareerXroads study were filled by new hires rather than from within.

There are other explanations for the increase. Among them is the potential for statistical distortion in the survey, which, while it covers 507,425 hires, has only 50 firms participating. Still that 5.9% represents about 15,660 fee-generating agency placements.

For historical perspective, a SHRM survey cited by CareerXroads, found agencies (contingent and search) accounted for 12.5% of hires in 1997.

Temps Are 1 in 6

In addition to the agency data, CareerXroads found that about one in six workers were contingent – temp or contract. This pool of workers was tapped more heavily last year than in the nine years of the survey question to fill full time openings. The survey found 4.4% of the hires were temp-to-perm conversions, a rate nearly three times that of 2012.

In addition, more than half the employers in the survey use an RPO for at least some of their recruiting. The consultancy notes that, “RPO is rebounding in large firms.”

LinkedIn Job Board

Most of the survey deals with issues specific to corporate recruiting, although a series of questions about how recruiters are using LinkedIn turned up the finding that more hires are being made by posting jobs to LinkedIn than by proactively searching the profiles. What this means is that LinkedIn is increasingly resembling a job board, which is where for the first time this CareerXroads categorized it.

However, LinkedIn as a source of hires is more balanced between posting and searching than job boards generally. Half the survey participants said job board hires predominantly come from posted jobs not resume searches. At LinkedIn, 11.8% come predominantly from posted jobs.

As a job board, LinkedIn ranked second to Indeed as a source of hire, accounting for 20.1% of all hires coming from job boards. Indeed was first with 31.2% of the hires.

Overall, job board postings and resume (or profile) searching, yielded 15.4% of all external hires.