The role of staffing organisations

The recruitment industry is playing a crucial role in enabling businesses and public sector organisations to secure the skills, operational flexibility and higher productivity needed to adapt to an economy in transformation and deliver higher quality services.

Staffing organisations serve employers and candidates seeking either permanent or temporary work. They can also provide fully outsourced employment solutions for contact centres and production facilities. Many organisations are looking to recruitment partners to help them overcome growing skills shortages and make the most of evolving approaches to the sourcing and selection of candidates including social media and new forms of profiling and screening.

The industry’s knowledge of both sides of the labour market – candidates and employers – provides dynamic intermediation:

• helping employers to manage fluctuations in demand

• helping to match the right people with the right organisations 

• helping workers to move to more rewarding and fulfilling positions.

Agency workers make up just under 5% of the UK workforce, the highest proportion in Europe. From an economic perspective, agency work can provide a ‘shock absorber’ during a downturn by enhancing flexibility and opportunity within the labour market. When the economy begins to recover, the availability of agency workers enables businesses to quickly respond to rising demand and can even help to boost growth overall. The valuable role played by the recruitment industry includes providing a ‘stepping stone’ into the labour market for unemployed people, young people coming out of education and people returning to work after a gap.

Effective regulation is an important element of agency work. Agency workers are entitled to holiday and sick pay. After 12 weeks, they are entitled to the same pay as permanent staff carrying out comparable work. But over-restrictive regulation can be counterproductive. The Randstad/SEO study Flexibility@work 2014, tackling undeclared work showed a direct relation between the level of regulation on agency work and the incidence of undeclared work. More restrictive regulation on agency work is often seen to push companies and workers towards other forms of flexible labour including undeclared work. The study revealed that when economies make it easier for businesses to turn to temporary employment and agency work to meet their flexible labour demands, the demand for undeclared labour diminishes.