Use of employment agencies on the wane

The use of recruitment and employment agencies* is falling – a trend that is likely to continue in the current economic climate, according to a survey by Personnel Today’s sister publication IRS Employment Review.

The survey of 148 employers – covering a combined workforce of just over 495,000 people – found that more than half (55%) expected to reduce their use of agencies this year, while only 3% believed they would increase their use. A further 6.1% said they were going to stop using agencies altogether.

Most respondents used agencies to find both temporary staff and direct recruits (74.8%). Public sector bodies were less inclined to make use of agencies to find direct recruits, probably due to factors concerning equal opportunities, while 74% of private sector services employers used agencies to source both direct recruits and temps.

Employers were most likely to use agencies to find direct recruits for professional roles (73.4%) including engineers, IT professionals and lawyers. The second most common use of agencies was as a source of temps for administrative, clerical and secretarial roles (64.7%).

The main reasons cited for using agencies included having access to suitable candidates, speed, and avoiding large volumes of applications.

The services provided by agencies that are used most often by employers include checking proof of a candidate’s legal right to work in the UK (used by 47.9% of employers), getting references (35.5%), and handling the initial recruitment administration, such as sending out acknowledgement letters (22.3%)

The top three priorities when choosing a recruitment agency were specialist expertise, proven effectiveness, and value for money.

The employers surveyed were reasonably satisfied that agencies offered value for money, but almost all agreed that they required careful monitoring. But fewer than half had evaluated their agencies’ performance in the past two years.

According to the Recruitment and Employment Confederation, more than £27bn was spent on employment agency fees in 2007-08.

* The term ’employment agency’ was used in this survey to describe those agencies that supply temporary staff who are not directly employed by the employer. The term ‘recruitment agency’ referred to agencies that put forward potential direct recruits for consideration for either temporary or permanent contracts.

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