Employment - Recruiting Agencies in The US Industry Report

US INDUSTRY (NAICS) REPORT 56131
Employment & Recruiting Agencies in the US

For hire: Stable labor conditions and new online recruiting methods are expected to
aid industry revenue
Rohan Jaura | September 2020
IBISWorld.com +1-800-330-3772 info@IBISWorld.com

Employment & Recruiting Agencies in the US 56131 September 2020
Contents
About This Industry...........................................5 Competitive Landscape...................................27
Industry Definition..........................................................5 Market Share Concentration....................................... 27

Major Players................................................................. 5 Key Success Factors................................................... 27
Main Activities................................................................5 Cost Structure Benchmarks........................................ 28
Supply Chain...................................................................6 Basis of Competition................................................... 32
Similar Industries........................................................... 6 Barriers to Entry........................................................... 33
Related International Industries....................................6 Industry Globalization..................................................33
Industry at a Glance.......................................... 7 Major Companies............................................ 35
Executive Summary....................................................... 9 Major Players............................................................... 35

Other Players................................................................38
Industry Performance..................................... 10
Operating Conditions...................................... 39
Key External Drivers.....................................................10
Current Performance................................................... 11 Capital Intensity........................................................... 39
Technology And Systems........................................... 40
Industry Outlook............................................. 15 Revenue Volatility........................................................ 42
Regulation & Policy...................................................... 43
Outlook......................................................................... 15
Industry Assistance..................................................... 43
Performance Outlook Data......................................... 17
Industry Life Cycle....................................................... 17 Key Statistics.................................................. 45
Products and Markets..................................... 20 Industry Data................................................................45

Annual Change.............................................................45
Supply Chain................................................................ 20
Key Ratios.................................................................... 45
Products and Services.................................................20
Industry Financial Ratios............................................. 46
Demand Determinants................................................ 22
Major Markets..............................................................23 Additional Resources...................................... 47
International Trade.......................................................24
Business Locations..................................................... 25 Additional Resources.................................................. 47
Industry Jargon............................................................ 47
Glossary Terms............................................................47
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About IBISWorld
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as well as industries that are truly global in nature.
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Covid-19
Coronavirus IBISWorld's analysts constantly monitor the industry impacts of current events in
real-time – here is an update of how this industry is likely to be impacted as a result
Impact Update of the global COVID-19 pandemic:
· Employment and Recruiting Agencies industry revenue is expected to decline in

2020 as reduced corporate profit and business sentiment have reduced demand for
permanent employees. For more information, please see Current Performance
chapter.
· Demand from certain markets is expected to decline in 2020 due to cost saving
measures and social distancing practices. For more information, please see the
Major Markets chapter and Demand Determinants chapter.
· COVID-19 (coronavirus) can be viewed as an external threat to this industry as it is

preventing companies from operating at full capacity. For more information, please
see the Basis of Competition and Demand Determinants chapters.
Note: The content in this report is currently being updated to reflect the trends
outlined above.
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About This Industry

Industry Definition This industry comprises establishments engaged in listing employment vacancies,
referring job applicants to potential employers and assisting companies with
employee recruitment and placement. Individuals referred or placed are not
employees of the employment agencies.
Major Players LinkedIn Corp.
Randstad Holding NV
Main Activities The primary activities of this industry:

Operating casting agencies or bureaus
Operating employment agencies or registries
Operating employment referral agencies or registries
Providing permanent placement services
Providing temporary placement services
Providing online job and resume listing services
The major products and services in this industry:

Permanent placement services
Executive search services
Temporary staffing services
Independent contractor placement services
Other
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Supply Chain
SIMILAR INDUSTRIES
Management Consulting in HR Consulting in the US Office Staffing & Temp Professional Employer
the US Agencies in the US Organizations in the US
RELATED INTERNATIONAL INDUSTRIES
None
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Industry at a Glance
Key Statistics Key External Drivers % = 2015-2020 Annual Growth
$18.8bn 3.0%
National unemployment rate
0.2%
Number of businesses
Revenue
-3.0% N/A
Annual Growth Annual Growth Annual Growth Corporate profit External competition for the Employment
and Recruiting Agencies industry
2015-2020 2020-2025 2015-2025
-2.2% 3.7% Industry Structure
POSITIVE IMPACT
$790.4m
Profit Capital Intensity Concentration
Low Low
Annual Growth Annual Growth
2015-2020 2015-2025 Globalization
Low
-7.0%
MIXED IMPACT
4.2% Life Cycle Regulation

Profit Margin Mature Medium
Annual Growth Annual Growth Technology Change

2015-2020 2015-2025 Medium
-1.2%
NEGATIVE IMPACT
10,314
Revenue Volatility Industry Assistance
High Low
Businesses
Barriers to Entry Competition
Annual Growth Annual Growth Annual Growth Low High
2015-2020 2020-2025 2015-2025
-1.8% 0.8% Key Trends

The industry's success is highly dependent on the national
unemployment rate
260k Operators that provide online services have consistently
Employment outperformed the industry as a whole
Annual Growth Annual Growth Annual Growth There has been major merger and acquisition activity
2015-2020 2020-2025 2015-2025 involving large industry operators
Traditional industry operators are expected to increase their
-2.4% 2.3% online presence
Employers will continue to prefer hiring permanent rather
than temporary workers
$10.0bn Technological innovation will continue to lower barriers to
Wages
entry
Annual Growth Annual Growth Annual Growth Industry performance is dependent on the national
2015-2020 2020-2025 2015-2025 unemployment rate, corporate restructuring activity and
overall demand for permanent new hires
-2.5% 2.6%
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Products & Services Segmentation
48.1% 34.7% 7.8% 6.0% 3.4%
Permanent placement Executive search services Temporary staffing Independent contractor Other
services services placement services
Employment & Recruiting Agencies
Source: IBISWorld
Major Players % = share of industry revenue SWOT
STRENGTHS
Low Imports
Low Customer Class Concentration
High Revenue per Employee
Low Capital Requirements
WEAKNESSES
Low & Steady Barriers to Entry
Low & Steady Level of Assistance
High Competition
High Volatility
Low Profit vs. Sector Average
High Product/Service Concentration
OPPORTUNITIES
High Revenue Growth (2020-2025)
National unemployment rate
THREATS
Low Revenue Growth (2005-2020)
Low Revenue Growth (2015-2020)
Low Outlier Growth
Low Performance Drivers
Corporate profit
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Executive The Employment and Recruiting Agencies industry has not

Summary performed well over the five years to 2020 due to a collapse of the
labor market in 2020, which has reduced demand for recruiting and
job placement services.
The COVID-19 (coronavirus) pandemic has severely hurt the economy and industry
performance in 2020. The pandemic is expected to cause the national
unemployment rate to increase 179.8% in 2020. Cost saving measures by
companies in this time of economic uncertainty has resulted in almost 45.0 million
people filing for unemployment benefits since March 2020. Overall, industry revenue
is projected to decrease an annualized 2.2% to $18.8 billion over the five years to
2020. In 2020, revenue is expected to decline 31.0% as decreases in corporate
profit and business sentiment reduce demand for permanent and executive
placement services.
Industry performance is dependent on the national unemployment rate, corporate

restructuring activity and overall demand for permanent new hires. The national
unemployment rate has shot up in 2020, reflecting poor economic conditions.
Technological development has had a major effect on industry structure, with
online profiles and job listing platforms creating opportunities for new businesses.
Meanwhile, larger operators have adopted online services to increase the efficiency
and accuracy of candidate selection and interviewing. Combined, these trends had
helped industry profitability expand prior to the pandemic in 2020. Industry
profitability is expected to decline in 2020 due to a decrease in overall demand in
the economy as companies and consumers are trying to be frugal during times of
uncertainty, thus industry operators are unable to maintain high profit.
Over the five years to 2025, the industry is expected to benefit from an anticipated
recovery of the economy and labor market. After the pandemic in 2020, the
economic recovery is expected to cause the national unemployment rate to decline,
improve business sentiment and increase corporate profit. Companies are expected
to be encouraged to engage in new hiring and restructuring after an economic
crisis. Profit is expected to rebound in 2021 and increase as demand for industry
services is expected to increase as companies look to hire. Companies in the
industry are expected to try focusing on offering higher-profit services. IBISWorld
expects industry revenue to increase an annualized 3.7% to $22.5 billion over the
five years to 2025.
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Industry Performance
Key External National unemployment rate

Drivers The national unemployment rate measures the proportion of Americans aged 16 or
older who are currently unemployed and looking for work. An increase in the
unemployment rate represents declining demand from businesses for employees
and, therefore, reduces the number of placements available along with industry
revenue. Conversely, stronger employment opportunities boost total revenue. The
national unemployment rate is expected to increase, posing a potential threat to the
industry.
Corporate profit
Corporate profit measures profit across all industries, not just the Employment and
Recruiting Agencies industry. An increase in corporate profit boosts available salary
budgets and increases business confidence, which encourages operators to hire
more staff, particularly on a permanent basis rather than on temporary contracts.
Corporate profit is expected to decrease in 2020.
Number of businesses
The number of businesses measures the total number of companies in the United
States with at least one employee. An increase in the number of businesses
increases the need for new workers, which boosts demand for industry-relevant
services, such as online job listings and candidate profiling. The number of
businesses is expected to decline in 2020.
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External competition for the Employment and Recruiting Agencies industry

Operators in this industry compete with companies that manage their own
recruiting, usually through online job portals and listings. Additionally, the industry
competes with temporary employees that mitigate demand for permanent
placements. External competition for the Employment and Recruiting Agencies
industry is expected to decrease in 2020, presenting a potential opportunity for the
industry.
Current The Employment and Recruiting Agencies industry consists of

Performance recruiting companies that help both entry-level and experienced
candidates find jobs that are most appropriate for their skillset and
experience levels.
In addition to traditional recruiting companies, the industry includes executive
search companies that specialize in recruiting upper management candidates. Over
the five years to 2020, growth in the number of new businesses and favorable
economic conditions prior to the COVID-19 (coronavirus) pandemic in 2020 had led
to increased demand for staffing services for permanent employees and
executives. Notably, the strongest growth during the five-year period has come from
the most technologically advanced operators. Relatively new industry players with
an emphasis on online recruiting and job listings have experienced rapid growth as
consumer preferences have trended toward online services. However, new online
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technologies are also creating heightened competition for industry operators, which
increasingly compete with businesses that create their own online job listing
platforms. The coronavirus pandemic is expected to cause a 179.8% increase in the
national unemployment rate and reduce corporate profit 12.1% in 2020. This is due
to uncertainty in the economy and a decrease in the business sentiment index.
Companies are not attempting to hire during a time of economic uncertainty;
instead, they will seek to be frugal. Overall, industry revenue is projected to
decrease at an annualized rate of 2.2% to $18.8 billion over the five years to 2020,
including a sharp decline of 31.0% in 2020 alone.
COVID-19 (coronavirus) pandemic
The coronavirus pandemic is expected to have an adverse effect on

the economy and industry in 2020.
The pandemic will likely be the driving force behind the performance in 2020.
Almost 45.0 million people have filed for unemployment benefits since the
beginning of March 2020. Companies are trying to cut costs due to uncertainty over
the economy. The services sector has been affected the most due to social
distancing protocols. The number of business is expected to decrease 2.3% in
2020, while the business sentiment index is expected to decline 9.3% in 2020.
Corporate profit is expected to decrease at an annualized rate of 3.8% over the five
years to 2020, including a 12.1% decrease in 2020 alone. Industry demand is
expected to sharply decrease in 2020 due to these factors, which is why there is an
expected 31.0% decrease in industry revenue in 2020. Due to social distancing
protocols, all nonessential retailers and businesses have been closed for a
significant period of time in 2020, drastically reducing the need for employees in
service industries and others. It is difficult for companies to remain profitable and
generate revenue if they are unable to sell their product or service, thus there is a
lower demand for industry services. Industry operators have seen a big decline in
demand for their services.
Employment opportunities decline
This industry's success is highly dependent on changes in the

national unemployment rate, corporate restructuring activity and
overall demand for permanent employment.
Over the five years to 2020, the economy and US labor market had been improving
until the coronavirus pandemic hit the United States in March 2020. The shift
toward specialized jobs in previous years in the period has declined, as companies
are not looking to hire permanent employees during times of economic uncertainty.
Therefore, executive recruiting and other professional services offered by industry
operators has seen a sharp decline as companies are unwilling to hire permanent
employees during unfavorable economic conditions. Although demand for
employment and recruiting agencies tends to surge during times of economic
duress when individuals seek increased assistance finding work, operators are
typically not paid until they have placed a client. The industry is expected to perform
poorly during the coronavirus pandemic, as a deficient economic performance
forced most employers to cut back on staff and reduce new hiring. Low corporate
profit levels have discouraged employers to resume operations and boost hiring
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over the five years to 2020. The national unemployment rate has increased rapidly
from 5.3% in 2015 to an estimated five-year high of 10.3% by the end of 2020.
Although growth was high prior to the coronavirus pandemic, a sharp decline in
demand for industry services has decreased industry revenue during the entirety of
the period. More Americans are seeking jobs in 2020, increasing demand for
industry services; however, companies are not expected to hire many people while
corporate profit and business sentiment have declined. This is expected to
significantly hurt industry performance in 2020.
Digital winners and losers
Over the past five years, widespread adoption of broadband internet

and mobile devices has continued to change how consumers
conduct everyday tasks.
The percentage of services conducted online has increased from 12.7% in 2015 to
20.4% in 2020; this increase reflects stronger consumer and business inclination to
use online substitutes. This trend has also changed the behavior of job candidates,
who have increasingly turned to internet job postings rather than traditional
recruiting agencies. The recruiting industry has changed significantly during the
period as a greater share of job candidates, particularly those between the ages of
18 and 25, relied on online recruiting and resume-screening services to help them
reach out to potential employers. Consequently, companies that have marketed
online recruitment and professional networking services have consistently
outperformed the industry as a whole. The most notable industry winner has been
LinkedIn Corporation (LinkedIn), which has had industry-relevant revenue grow an
estimated annualized 22.3% over the five years to 2020. The company has grown
from a small start-up in 2002 to one of the largest providers of recruitment and
professional networking solutions through its streamlined interface and intuitive
profile-creating platform. Other online companies, such as Indeed.com, have also
experienced strong growth during the period, investing profit into further product
development and thus gaining greater market share. Conversely, some online
recruitment companies (IBISWorld report OD4590), including Monster.com and
CareerBuilder.com, have underperformed the industry as a whole during the five-
year period.
Traditional recruiting services provided by well-established operators such as

Randstad Holding NV and Adecco SA have also garnered strong demand, prior to
the coronavirus pandemic, since professional candidates seeking positions in
middle and upper-management continue to rely on the expertise and vast network
of traditional recruiting agencies. Lastly, traditional executive search companies
such as Korn Ferry and Spencer Stuart have performed well due to increased
corporate restructuring and acquisition activity, which have driven demand for
executive search services (IBISWorld report OD5670).
Profitability and industry structure
Industry profit (measured as earnings before interest and taxes) is

expected to decline from 5.4% of industry revenue in 2015 to 4.2%
in 2020.
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A sharp decline in demand from businesses for recruiting assistance has reduced
transaction volumes and not allowed operators to increase the cost of providing
recruitment services to levels pre-coronavirus. Over the five years to 2020, prior to
the pandemic, demand for higher-margin services such as middle- and upper-
management recruiting, in addition to traditional executive search services, had
increased as a share of total revenue over the five years to 2020. Greater focus on
these services had played a role in boosting industry profit. An overall decline in the
economy has significantly hurt demand for the industry in 2020 and discouraged
industry operators from pursing higher profit. Recruiting companies are expected to
lay off employees in anticipation of this sharp decline in demand for their services
in 2020. The number of industry employees is forecast to fall at an annualized rate
of 2.4% to 260,462 workers over the five years to 2020. Similarly, the number of
industry establishments is expected to decrease an annualized 2.3% to an
estimated 11,277 locations over the five years to 2020. There has been significant
merger and acquisition activity involving large industry operators in recent years. In
December 2016, LinkedIn was purchased by Microsoft Corporation and
Monster.com was purchased by Randstad Holding NV. This trend is expected to
continue industry-wide, affecting operators of all sizes.
Historical Performance Data

Year Revenue IVA Estab. Enterprises Employment Exports Imports Wages Domestic Unemploym
Demand ent rate
($m) ($m) (Units) (Units) (Units) ($m) ($m) ($m) ($m) (%)
2011 18,930 12,202 12,546 11,428 267,454 N/A N/A 11,231 N/A 8.95
2012 18,588 11,888 12,333 11,300 276,733 N/A N/A 10,771 N/A 8.07
2013 18,935 11,458 12,242 11,155 287,890 N/A N/A 10,404 N/A 7.38
2014 20,150 11,880 12,357 11,114 296,026 N/A N/A 10,802 N/A 6.17
2015 20,981 12,546 12,672 11,268 293,526 N/A N/A 11,366 N/A 5.29
2016 22,866 12,952 12,475 11,294 296,404 N/A N/A 11,586 N/A 4.87
2017 24,141 13,034 12,201 11,061 297,903 N/A N/A 11,712 N/A 4.35
2018 26,940 14,648 12,741 11,497 323,082 N/A N/A 12,776 N/A 3.90
2019 27,259 14,839 12,820 11,563 327,567 N/A N/A 12,948 N/A 3.67
2020 18,820 10,847 11,277 10,314 260,462 N/A N/A 10,024 N/A 10.3
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Industry Outlook
Outlook Over the five years to 2025, the Employment and Recruiting
Agencies industry is expected to rebound and show signs of growth
as the US labor market is expected to rebound the national
unemployment rate decreases.
IBISWorld anticipates industry
revenue to expand due to recovering
macroeconomic conditions, which
will encourage new and existing
businesses to enter new markets
and expand the size of their
workforce. The economy is expected
to recover in 2021 after the
COVID-19 (coronavirus) pandemic in
2020. Demand for professional
recruiting services and permanent
placement services are expected to
increase in favorable economic
conditions. As social distancing
protocols loosen and business
sentiment improves, companies will
be encouraged to hire permanent
employees to accelerate the growth
of their companies. Rising corporate profit levels and heightened corporate
restructuring activity, in line with globalization, outsourcing and a constantly
changing regulatory environment, will also boost demand for executive search
services, which currently account for a 35.0% share of industry revenue. However,
internal and external competition is expected to remain fierce in the industry.
Technological changes will continue to present both opportunities and threats to
industry participants, placing significant pressure on the profitability of smaller
operators that are unable to offer value-added services outside the scope of
standard job listings or traditional recruitment. Overall, industry revenue is expected
to increase an annualized 3.7% to $22.5 billion over the five years to 2025.
Job openings provide growth
The industry is expected to record growth over the next five years,
as operators are expected to benefit from improving
macroeconomic conditions such as relatively lower volatility in job
markets.
The unemployment rate is expected to decline over the next five years, IBISWorld
anticipates that employers will continue to prefer hiring permanent workers rather
than temporary workers during the period, thereby sustaining demand for the
industry's largest service segment. In addition, the total number of businesses
operating in the United States is expected to continue growing at an annualized rate
of 0.8% over the five years to 2025. Although smaller businesses generally do not
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use traditional recruiting companies to find their employees, they are likely to use
online recruiting sites such as CareerBuilder and LinkedIn to advertise these
opportunities, thereby boosting demand for online job postings and other internet-
based recruiting services.
Online tools will continue to support the search-submitted applications of both

employers and recruiting companies. Additionally, industry operators will continue
to develop new methods for checking qualifications and tracking potential
candidates. Industry services will remain labor-intensive as further analysis,
candidate interviews and testing will remain highly personalized processes. A
personalized recruiting process will remain particularly important for executive
search companies, which leverage their extensive network and talented recruiters to
find the most appropriate candidate for vacant middle- and upper-management
positions.
However, industry operators that readily adopt the latest technology as a tool for
recruitment and employment will continue to outperform the industry as a whole. In
broad terms, the percentage of services conducted online is expected to increase
from 20.4% in 2020 to an estimated 25.6% in 2025 as both consumers and
businesses transition services online for greater efficiency and convenience.
Consequently, internet-based operators such as LinkedIn Corporation and
Indeed.com will continue to be successful as they increase the size of their user
base and respond to online preferences through intuitive job listings and mobile
application development. For more information on internet-based recruiters, see the
Online Recruitment Sites industry report (IBISWorld report OD4590).
Traditional industry operators, such as major players Randstad Holding NV and

Adecco SA, are also expected to increase their online presence in response to rising
demand for these services from employers seeking middle- and upper-
management candidates. However, technology will also continue to pose a
potential threat to industry operators. More US corporations are likely to post and
manage their own job listings as online portals permit candidates to easily upload
information and fill out other key details. Furthermore, third-party IT consulting
solutions such as Oracle's Taleo Cloud Service will threaten online recruiters, since
these software-as-a-service platforms enable businesses to conduct candidate
searches and placement on their own without outsourcing to a professional
recruiting agency (IBISWorld report 54151).
Profit and expansion
Industry profitability is expected to increase over the five years to

2025 as the economy begins to recover and companies are
encouraged to pursue a higher profit margin while demand for
industry services is high.
The increasing use of technology will help reduce administrative costs and improve
company profit as well. However, the growing prevalence of online recruiting sites,
which are typically less profitable than traditional recruiting services, is expected to
constrain average profit during the coming five-year period. Overall, industry profit
(measured as earnings before interest and taxes) is expected to grow to 7.1% of
industry revenue in over the five years to 2025.
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Technological innovation will continue to lower barriers to entry, encouraging new

operators into the industry over the five years to 2025. The number of industry
enterprises is projected to increase at an annualized rate of 0.8% to 10,741
companies over the five years to 2025. Despite this continued influx of new players,
market share concentration is expected to increase as larger players continue to
outperform smaller rivals, particularly within the executive search services
segment. Furthermore, larger recruiting companies are likely to continue acquiring
smaller competitors to capitalize on economies of scale and offer a broader
selection of value-added services. Strong performance and a rebounding economy
will encourage industry operators to hire new workers, with total industry
employment projected to increase an annualized 2.3% to 291,911 workers over the
five years to 2025.
Performance Outlook Data

Demand ent rate
2020 18,820 10,847 11,277 10,314 260,462 N/A N/A 10,024 N/A 10.3
2021 19,915 11,835 11,469 10,462 269,906 N/A N/A 10,431 N/A 7.68
2022 21,033 12,349 11,663 10,613 279,419 N/A N/A 10,843 N/A 5.56
2023 21,833 12,714 11,767 10,690 286,133 N/A N/A 11,134 N/A 4.65
2024 22,195 12,877 11,796 10,707 289,073 N/A N/A 11,262 N/A 4.55
2025 22,530 13,030 11,842 10,741 291,911 N/A N/A 11,384 N/A 4.47
Industry Life Cycle The life cycle stage of this industry is Mature
LIFE CYCLE REASONS

Industry growth typically follows the overall economy, although recent growth has been
driven primarily by a recovering labor market
Technological change is quickly altering the way the industry operates
The industry is expected to continue consolidating, although it remains highly fragmented
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The Employment and Recruiting Agencies industry is in the mature phase of its life
cycle. Industry value added (IVA), used to measure an industry's contribution to the
overall economy, is projected to grow at an annualized rate of 0.4% over the 10
years to 2025. In contrast, the overall economy is forecast to grow at a faster
annualized rate of 1.5% during the same period. Growth in IVA is primarily a result
of recovering profit margins and sales in the post COVID-19 (Coronavirus)
economy. Over the next five years, IVA growth will be relatively faster as industry
revenue recovers as the economy recovers post the pandemic.
The industry is characterized by a moderate rate of technological change, a growing

number of industry players, wholehearted acceptance of industry services and a
well-defined portfolio of standard services offered by the industry; these traits are
all characteristic of an industry currently in the mature stage of its life cycle. Over
the five years to 2020, a rapidly increasing national unemployment rate and
declining corporate profit has discouraged new hiring and management
restructuring, thereby reducing demand for recruitment services. However, prior to
the coronavirus pandemic in 2020, a strong labor market and an increasing number
of businesses resulted in strong growth in the industry.
The industry is undergoing significant change, driven primarily by the widespread

adoption of online recruitment services and other technological developments.
Industry players such as LinkedIn are becoming increasingly relevant through online
operations, which attract consumers because of their user-friendly and convenient
services. Furthermore, traditional operators are able to increase their efficiency by
investing in technologies that help cull potential candidates based on keyword and
criteria searches. Operators that can successfully implement these new
technologies could potentially be able to reduce the need for human input over the
five years to 2025.
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The coronavirus pandemic is expected to hurt industry performance in 2020 and

significantly reduce demand, but as the economy recovers in 2021, industry revenue
is expected to recover and increase in favorable economic conditions. Post the
pandemic, the industry is expected to consistently increase as an improving labor
market, increasing corporate profit and an improving business sentiment index will
increase demand. Demand from job creators is expected to increase during
favorable economic conditions, while demand from job seekers will be at a high due
to the large amount of unemployed people. The industry is expected to grow an
annualized 3.7% in the outlook period compared to an annualized 2.2% decrease in
the current period.
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Products and Markets

Supply Chain KEY BUYING INDUSTRIES KEY SELLING INDUSTRIES
1st Tier 1st Tier
Finance and Insurance in the US Commercial Leasing in the US
Professional, Scientific and Technical Office Supply Stores in the US
Services in the US
Computer Stores in the US
Information in the US
2nd Tier
2nd Tier Human Resources & Benefits
Healthcare and Social Assistance in the Administration in the US
US
Internet Service Providers in the US
Manufacturing in the US
Wireless Telecommunications Carriers in
Retail Trade in the US the US
Products and
Services
Permanent placement services
Permanent placement services are estimated to account for 48.1%

of industry revenue in 2020.
Permanent placement services include recruiting, selecting and referring candidate
to clients to fill positions on a permanent or indeterminate basis. Services involved
include candidate testing, interviewing, reference checking, evaluation and
counseling of prospective employees. Service providers act as an employment
intermediary as candidates are finally selected and hired by the client. Companies
are then paid on a contingency basis, meaning that only successful placement of a
20 IBISWorld.com
candidate will result in revenue. Over the five years to 2020, a strong decline in
business activity in 2020 due to the COVID-19 (Coronavirus) pandemic and
declining business sentiment has made companies less comfortable with hiring
permanent staff during 2020. This segment is expected to slightly decline as a
share of revenue in 2020.
Executive search services
Executive search services are forecast to comprise 34.7% of

revenue in 2020.
This segment includes the same services as offered in permanent placement
services, although it focuses on corporate executives and other upper management
and professional positions. Industry operators provide detailed interviews with
client management teams, develop specific job profiles, conduct original research
and advertising, screen candidates and present and discuss confidential lists of
highly qualified applicants. Additionally, industry operators negotiate compensation
and provide post-hire follow-up with successful candidates. The provision of this
service typically includes assurance clauses such as the repeat of a search at no
extra charge should a successful candidate subsequently fail for reasons attributed
to lack of due diligence by the company, and not to recruit from the company for a
given period of time. This segment has grown as a proportion of revenue over the
five years to 2020 due to stronger business activity. However, this segment is
expected to slightly decline in 2020 due to a reduction in business activity caused
by the coronavirus pandemic.
Temporary staffing services
Industry operators typically do not provide temporary staffing

services, which are included in the Office Staffing and Temp
Agencies industry (IBISWorld report 56132).
However, temporary staffing services are estimated to account for 7.8% of revenue
in 2020 since several larger traditional recruiting companies, such as Randstad and
Adecco, offer temporary staffing as a part of their diversified service portfolio.
Unlike executive search and permanent placement services, industry operators of
temporary and contract placement services do not necessarily require up-front fees
and retainers. Over the five years to 2020, this segment's share of industry revenue
has declined slightly as companies were encouraged to hire permanent employees.
However, this segment is expected to decline significantly in 2020 due to poor
economic conditions caused by the pandemic. Temporary workers are usually the
first to be laid off during times of economic uncertainty.
Independent contractor placement services
Independent contractor placement services are estimated to

account for 6.0% of revenue in 2020.
Recruitment and employment agencies find individual contractors to fill positions
based on written contracts that stipulate job duties negotiated by clients. Under
these agreements, the service provider has legal rights with respect to the individual
21 IBISWorld.com
contractor, who is responsible for its own payroll deductions and government
filings. This segment experienced growth in the immediate aftermath of the
recession as companies remained hesitant to increase the size of their workforce
and instead opted to hire independent contractors who were not officially employed
by the company and assigned to complete specific roles. However, this segment
has declined as a proportion of revenue recently as operators resume seeking full-
time employees over short-term fixes.
Demand Demand for the Employment and Recruiting Agencies industry's

Determinants placement services follows the ebbs and flows of the economic
cycle, particularly with sudden changes in the labor force and the
unemployment rate.
As the unemployment rate increases, demand for permanent placement services
will increase among unemployed workers in search of permanent work. For industry
recruiting agencies, however, there is often far less economic activity from
companies during periods of high unemployment. Employers will reduce salary
costs by instituting hiring freezes or even laying off employees amid economic
downturns, which greatly reduces the economy's overall demand for employment
and recruiting agencies among job creators.
Demand for senior and executive recruitment is particularly sensitive to business

sentiment and overall economic conditions. Since the industry's executive
recruitment services are typically charged as a percentage of the position's salary,
companies are quick to hire for major roles using in-house recruitment systems
during recessionary periods. Additionally, there is far less staff turnover when
economic conditions are uncertain because employed workers will be less inclined
to pursue a new position if the labor market has few suitable openings. Many
industry players also operate in the Office Staffing and Temp Agencies industry
(IBISWorld report 56132). Temporary employment agencies tend to grow and
decline parallel to the Employment & Recruiting Service industry, although
temporary agencies offer a greater degree of flexibility than permanent work
agencies. While all hiring can be expected to suffer during an economic downturn,
temporary workers are often hired more readily over full-time employees, as
companies are wary to invest in permanent workers until economic conditions
improve. Accordingly, demand for temporary staffing services tends to be highest in
the immediate years following a recession, whereas demand for permanent
placement services tends to rise in the two to three years following a recession.
A growing number of industry operators are expanding their portfolio to include

value-added services such as outplacement services, training and human resources
consultancy services. Outplacement services are intended to help both employers
and terminated employees transition to new employment through structuring
severance pay, offering job-search advice and even providing counseling services.
These services are typically countercyclical, with demand for new employment
increasing as economic activity and unemployment increase. During the COVID-19
(Coronavirus) pandemic, many agencies are expected to experience an increase in
demand for outplacement services; however, the gains associated with providing
these services will not mitigate losses from lulls in demand for permanent
22 IBISWorld.com
placement, which has traditionally accounted for the largest share of industry
revenue.
The coronavirus pandemic and social distancing protocols have caused an increase
in the national unemployment rate. Companies are not operating at full capacity;
retailers and the service industry have been closed for a significant period of time.
The pandemic has caused more than 40 million people to file for unemployment
benefits since March 2020. Demand is expected to increase among unemployed
workers as the national unemployment rate is expected to increase 179.8% in 2020.
However, as corporate profit is low and business sentiment has decreased due to
uncertainty in the economy, the economy's demand for employment and recruiting
agencies among job creators will significantly decline.
Major Markets
Commercial
The commercial market includes the industrial (e.g. manufacturing and

construction) sector, as well as administrative and clerical staffing. This segment is
estimated to account for a combined 45.8% of revenue for the Employment and
Recruiting Agencies industry in 2020. Jobs in these industries, particularly in
nondurable goods manufacturing and construction, account for the majority of
temporary placement revenue. In addition to temporary placement, this segment is
also a large market for permanent placement services, particularly for
administrative positions. This market's share of industry revenue has remained
relatively unchanged over the five years to 2020. However, demand from this market
segment is expected to decrease in 2020 due to the COVID-19 (Coronavirus)
pandemic. Manufacturing and non-essential construction have been restricted or
stopped for a significant period of time across the US due to social distancing
protocols. Thus, demand from this market is expected to decrease.
Executive and managerial
Executive and other managerial positions are expected to generate 35.0% of

industry revenue in 2020. These positions are not filled as quickly as most
commercial positions; however, they typically provide higher revenue per job filled.
23 IBISWorld.com
These positions include mid-level management (e.g. regional managers or vice

presidents) and in some cases, can include placement services for CEO and CFO
positions. Over the five years to 2020, this segment has expanded as a share of
total revenue as larger business clients are increasingly seeking the help of industry
operators to fill positions that require a higher level of skill and education. However,
demand from this market segment is expected to reduce in 2020. As the
coronavirus pandemic has created unfavorable economic conditions, companies
have chosen to move their recruitment of executives and managers in-house, in
order to save costs.
Technical
Information technology (IT) and other technical (e.g. engineering) positions are
another major source of revenue for the Employment and Recruiting Agencies
industry. IBISWorld estimates this market to account for 9.1% of total industry
revenue. Demand for employees who have technical and IT skills was relatively
constant leading up to 2017, when outsourcing activity led to decreased demand.
Demand from this market segment is expected to remain stable despite the
pandemic. Most technical positions particularly in IT, have the ability of working
from home. Thus, social distancing protocols are not expected to affect demand
from this market as much as other segments.
Healthcare
The industry generates an estimated 10.1% of revenue from prospective employers

seeking work in the healthcare sector. While some of these prospective workers
seek administrative and office positions within the healthcare sector, many are part-
time and full-time licensed nurses and physicians in search of permanent and
temporary job placement. This segment has grown over the five years to 2020 as a
result of increased healthcare expenditure, which stemmed from the passing of the
Private Patient Affordable Care Act (PPACA). Demand from this market segment is
expected to increase in 2020 as the demand for professionals in the healthcare
sector has increased. A larger number of patients in hospitals due to the
coronavirus pandemic has resulted in an increase in demand for healthcare
professionals.
International Exports in this industry are Low and Steady

Trade
Imports in this industry are Low and Steady
Due to the service-based nature of the Employment and Recruiting Agencies

industry, employment and recruiting agencies do not participate in any international
trade. However, domestic players have increasingly focused on entering emerging
markets, where rapidly developing labor markets create lucrative opportunities for
recruiting companies. Likewise, several foreign-owned recruiting companies have
entered the US market to capitalize on America's dynamic labor force. For example,
major player Adecco SA is a Swiss human resources consulting company with a
dominant presence in Western Europe; revenue from US clients generated only
10.7% of the company's net sales in 2019. Like other international employment
24 IBISWorld.com
agencies, Adecco has specifically targeted North America as a key resource for job
growth following the recession.
Business
Locations Business Concentration in the United States
WA
MT ME
ND
VT
OR MN
NH
ID WI
SD NY MA
WY MI CT RI
IA PA
NV NJ
NE
OH MD
IL IN DC DE
UT
CO WV VA
KS MO
CA KY
NC
AZ TN
OK
NM SC
AR
AL GA
MS
TX LA
FL
AK
HI
Percentage of Establishments (%)
0 5 10 15
Employment & Recruiting Agencies in the US

Source: IBISWorld
The geographic spread of the Employment and Recruiting Agencies industry largely
reflects the distribution of population and economic activity. Furthermore, the
amount of revenue generated in each region largely reflects the number of
establishments within the respective regions. However, the West and Mid-Atlantic
regions, which primarily offer executive search services, generate slightly more
revenue per establishment than the national average. This is due to the high-value
positions that are located within these regions, which typically garner higher fees.
Southeast
The Southeast region is home to 22.0% of industry establishments, making it a

major region for the industry. This is largely the result of the types of positions that
are placed in the region. Unlike many companies in the Mid-Atlantic, which focus on
highly paid professional positions, operators in the Southeast are more likely to
25 IBISWorld.com
focus on recruiting for lower-wage jobs, particularly in the retail and service sectors.
This leads the region to account for a slightly small portion of industry revenue
relative to the percentage of establishments in the region. Florida maintains a
dominant presence within this region, accounting for 7.6% of all industry
establishments.
Mid-Atlantic
The Mid-Atlantic region is expected to account for 19.2% of industry

establishments. The region's high share of establishments is largely due to New
York, where an estimated 9.4% of industry establishments are located. Many
agencies in the Mid-Atlantic focus on professional and executive recruitment
services, which represents the largest and most profitable segment within this
industry. In contrast, agencies in the West, Great Lakes (14.8% of industry
establishments) and Southeast regions tend to service more low-skilled sectors,
such as nondurable manufacturing and retail.
West
With 17.4% of total industry establishments, the West represents the third-most
important region for industry services. California is an essential market for the
West; its 13.8% of the region's employment agencies is a higher percentage than
that of any other state. Many of the operators in the region rely on the
entertainment industry; a large number of these regional companies are casting
agencies and bureaus. Although casting agencies for entertainers do not make up a
major segment of the industry's market, it is the most important component of the
industry's business in California due to its proximity to music and film studios.
26 IBISWorld.com
Competitive Landscape
Market Share Concentration in this industry is Low
Concentration
The Employment and Recruiting Agencies
industry has a low level of market share
concentration, with the three largest
operators expected to generate only 23.7%
of industry revenue in 2020. Due to its
client-oriented nature, this highly
fragmented industry is characterized by
many small enterprises operating in
narrow geographic markets. These small
employment and recruiting agencies
typically focus on servicing local and
regional customers and build relationships
with businesses in these areas. Larger
companies with a global presence, such as
Adecco and Randstad, still have a
relatively low share of the market because
of the highly dispersed and localized nature of recruiting services. Additionally, the
wide range of sectors that industry operators staff employees for keeps
concentration low, as operators typically only focus on one or two of these markets.
Market share concentration has fallen over the five years to 2020. The rapid
digitization of online job listings and other services has enabled new players such
as LinkedIn Corporation and Monster Worldwide Inc. (Monster) to enter the industry
and quickly capture a large market. Traditional recruiting agencies such as
Randstad Holding NV (Randstad) have also increased their share of the market over
the past five years, though their growth was primarily driven by merger and
acquisition activity. For example, Randstad acquired Monster, a major operator
within the industry, for $429.0 million in 2016, which helped boost the company's
industry-relevant revenue. The industry is expected to continue consolidating over
the next five years as large, traditional recruiting companies continue to acquire
smaller competitors, while internet-based recruiters continue to outperform the
industry as a whole through new product development and aggressive marketing. A
sharp decrease in industry revenue due to unfavorable economic conditions caused
by the COVID-19 (Coronavirus) has resulted in many enterprises exiting the industry.
Companies in this industry have decided to cut costs due to uncertainty in the
industry and a high unemployment rate, resulting in some of them losing their
market share.
27 IBISWorld.com
Key Success IBISWorld identifies 250 Key Success Factors for a business. The most important for this
Factors industry are:
Ability to effectively communicate and negotiate: Employees should have the ability to
effectively communicate with clients and be able to understand a company's corporate
culture and exactly what they are looking for in a candidate.
Must have license: Licenses for businesses and counselors are required to operate in
most states.
Ability to quickly adopt new technology: Keeping up to date with new technology,
particularly the use of the internet portals for information on job vacancies and resume
screening by employers, is vital for success in this industry.
Providing client confidentiality: It is important to ensure total confidentiality in all areas

of operation and in all dealings with clients and potential placements. This factor is
particularly important for executive search companies.
Access to highly skilled workforce: Companies should hire talented and amiable
workers who can seek out the best potential candidates for a job and negotiate effectively
between clients (employers) and job candidates.
Cost Structure
Benchmarks
28 IBISWorld.com
Profit
Profit margins for employment and recruitment

agencies, measured as earnings before interest
and taxes, tend to be low, making the industry
particularly vulnerable to changes in the
economy and demand for labor. Some agencies
specialize in placing professional clients, which
typically generates a higher margin per
placement than companies that specialize in
lower-margin placements, such as clerical,
technical or manufacturing. Furthermore,
companies that offer online services typically
have higher profit margins than their offline
counterparts due to lower operating costs. In
periods of decreased economic and investment
activity, competitive pricing generally erodes
profit margins. Industry demand has decreased
significantly due to the pandemic and
companies' unwillingness to hire permanent
employees during times of uncertainty. Industry
profit has declined from 5.4% in 2015 to 4.2% of
industry revenue in 2020. Industry profit margins
are expected to rebound over the five years to
2025 as the economy and labor market is
expected to rebound.
Wages
This industry is highly labor-intensive because

operations require personal, face-to-face service
to generate business from corporate clients and
potential employment candidates. Although
internet sites, data warehousing and mining
software are increasingly being used to
complete initial job screening tasks, candidates
must still be screened in person by industry
employees and in-person interviewing is
extremely helpful for industry consultants to get
a strong assessment of the individual character
of each job seeker. While the industry remains
labor intensive, wage expenses fell due to a
20.2% decrease in employment in 2020. This led
wages share of revenue to decline from 54.2%
of industry revenue in 2015 to 53.3% in 2020.
While operators are expected to increasingly rely
on technology to perform candidate searches,
highly qualified workers will still be needed to
place candidates. This will lead wages share of
revenue in the industry to increase in the future.
29 IBISWorld.com
Purchases
Purchases of software, equipment and

administrative items are expected to account for
24.2% of industry revenue in 2020. Industry
operators use complex software to analyze and
sort through large number of potential
candidates resumes. Additionally, industry
operators pay for and build databases of
candidate information to reference at a later
date.
Depreciation
IBISWorld estimates depreciation accounts for

just 0.2% of industry revenue in 2020.
Depreciating items include fixtures, fittings,
computer equipment and software. Although
this industry has a low capital intensity, the use
of computer equipment to find and select
potential candidates has increased over the five
years to 2020. This trend is expected to
continue, leading to marginal increases in
depreciation. However, depreciation costs vary
significantly, depending on the level of
personalized service the company offers.
Therefore, online players have high depreciation
costs while local placement companies typically
incur very low depreciation expenses.
Marketing
While it is important for workers to know

industry operators, marketing is not the channel
through which they reach them. As a result,
marketing expenses only account for 1.9% of
industry revenue.
30 IBISWorld.com
Rent
Relatively small premises are required to

operate an employment placement agency;
however, some agencies incur high rental costs
by working in geographically important regions
that are close to established clients. Rental
expenses are estimated to account for 2.7% of
industry revenue in 2020.
Utilities
Similarly, since operators do not operate out of

large facilities, utility expenses only account for
0.9% of industry revenue in 2020.
Other Costs
Other expenses cover a wide range of items

including insurance and legal expenses.
31 IBISWorld.com
Basis of Competition in this industry is High and Increasing

Competition
Internal competition
Operators in the Employment and Recruiting Agencies industry that

develop a close and personal relationship with clients, maintain
their quality of service and have a high level of client satisfaction
tend to see consistently strong performance.
Additionally, operators that strive to understand their clients' businesses, corporate
culture and needs provide a higher level of service to their clients. Among major
players, having a global network of offices provides a distinct advantage, especially
as many corporations move into emerging markets. Most of the major players have
operations across Europe and Asia, with many recently moving into the Middle East
and Latin America.
Employment agencies are challenged by fee-based competition, especially when

economic growth deteriorates and unemployment increases. The COVID-19
(Coronavirus) pandemic has caused serious price competition within the industry,
causing many companies to reduce pricing to maintain existing clients and attract
new ones. The industry has minimal barriers to entry, so competitors often contend
with a large number of small operators, causing relatively low net income margins.
To remain competitive, employment agencies must develop and maintain a large,
up-to-date database of potential employees and contacts in key client industries. A
company that has access to a well-organized database, in addition to the latest
search technologies, can readily identify potential headhunting opportunities for
clients. The ability to offer internet-based advertising of jobs and online
applications is now essential; operators that do not invest in such capabilities will
suffer if available jobs are not brought immediately to the attention of potential
candidates.
External competition
Industry operators experience limited competition from related

industries that supply similar services, such as the Office Staffing
and Temp Agencies industry (IBISWorld report 56132).
32 IBISWorld.com
Many industry operators offer services across related industries; for example,
Adecco SA generates the majority of its revenue from temporary staffing services,
which are technically not included in this industry. The industry also competes with
internal corporate human resources divisions that perform their own recruiting
instead of outsourcing this work to professional employment agencies. This has
become more common over the past five years, as many companies have scaled
back on recruiting-related costs. Certain industry operators, particularly traditional
recruiting companies, also compete with employment services provided by
professional networking websites and low-cost (or free) job boards. The
coronavirus pandemic can be viewed as an external threat to the industry as it is
has resulted in an expected increase of 179.8% in the national unemployment rate
in 2020. Social distancing protocols and poor economic conditions have seen many
people laid off and decreased demand for employees. Companies are less likely to
require the services of this industry as they are not looking to hire or moving
recruiting in-house to save costs.
Barriers to Entry Barriers to entry in this industry are Low and Steady
The Employment and Recruiting

Agencies industry has few barriers to Barriers to entry checklist
entry. In terms of regulations, Competition High
employment agencies should be
Concentration Low
licensed to perform corporate
consultation and recruitment activities. Life Cycle Stage Mature
In some states, a counselor's license is
Technology Change Medium
also required for any person who
interviews, counsels or advises Regulation & Policy Medium
candidates and clients on any matter
Industry Assistance Low
related to employment and contracts.
Having a license permits the business to
charge for the provision of services. In addition, the industry has a very low level of
capital intensity. New entrants could provide services from a home office with little
more than computer and telephone access.
Furthermore, the industry has a low level of market share concentration due to the
ease with which companies may enter and exit the industry. Consequently, the
industry is highly fragmented and has a large number of small operators that can
often carve out a space within the industry by providing services to small, local or
niche businesses. In general, new businesses may have difficulty establishing
relationships with large corporations and clients, but this is only pertinent to
entrants wishing to expand their business beyond a local or regional level.
Entrants will need to build a reputation based on providing quality candidates. In

addition, new entrants are likely to be more successful if they are able to provide a
full range of employment services, including temporary placement, permanent
placement, executive search and training services. In general, larger clients that
demand a variety of services prefer to use a single operator that provides many
services at an affordable price than multiple operators that each offer a different
service.
33 IBISWorld.com
Industry Globalization in this industry Low and Increasing

Globalization
The Employment and Recruiting Agencies industry has a low level of industry
globalization. Since the industry is service-based, it does not participate in any
international trade. Nevertheless, larger industry players are increasing their
operations overseas to provide services to global corporations, while large
international recruiting companies have established regional branches throughout
major US metropolitan areas. Globalization has made the US labor market
increasingly global, and many prospective employees are open to the possibility of
working abroad as a means of both growing their careers and experiencing
business culture in other parts of the world. Industry globalization is therefore
increasing gradually, although the majority of industry employment and recruiting
agencies continue to operate on a local or regional basis. Globalization is expected
to decrease across all industries. Companies are hesitant to expand globally during
the COVID-19 (Coronavirus) pandemic in 2020, due to social distancing protocols
and poor economic conditions.
34 IBISWorld.com
Major Companies
Major Players LINKEDIN CORP.
Market Share: 15.9%

Founded in 2002, LinkedIn Corp. (LinkedIn)
has grown from a small, Silicon Valley start-up
to one of the largest professional networking
websites in the world. The company's
platform enables members to pursue success
in their careers by managing contacts and
sharing qualifications and personal
information digitally. Furthermore, the website
permits members to seek jobs through online
listings and recruiter programs. LinkedIn had
over 16,000 full-time workers worldwide in
2019 (latest available data). Across all business segments and geographic regions,
LinkedIn generated $6.8 billion in net sales in 2019. As of 2019, LinkedIn's online
network included over 690.0 million members from more than 200 countries,
including an estimated 169.0 million members in the United States. Recently, the
company has focused on expanding into foreign markets; in 2015, more than three-
fourths of new members were from outside of the United States.
LinkedIn operates through three segments: talent solutions, marketing solutions

and premium subscriptions. Industry-specific operations are conducted through the
35 IBISWorld.com
company's talent solutions segment, which seeks to match talent with opportunity
through leveraging data from employer and employee profiles. The segment
generates revenue by selling space where companies can post available positions,
while candidates can upgrade to premium subscriptions to access enhanced
search results and communication capabilities. Over the five years to 2020, the
company has pursued several expansion opportunities, including opening European
headquarters in Dublin and acquiring Pittsburgh-based mSpoke, a software
developer.
In June 2016, Microsoft Corporation (Microsoft) announced its plan to purchase

LinkedIn for $26.2 billion. The deal was officially completed in December 2016 after
being cleared by regulatory bodies in the United States and Europe. LinkedIn will
remain its own standalone operation under Microsoft moving forward.
Financial performance
LinkedIn's streamlined interface and focus on rapidly expanding its user base has
helped it become one of the fastest-growing online recruiting companies over the
past five years. The company's US industry-specific revenue is forecast to grow at
an annualized rate of 22.3% to $3.0 billion over the five years to 2020. The COVID-19
(Coronavirus) pandemic had minimal net impact on total revenue. LinkedIn reduced
their advertising spending as a cost saving measure. However, LinkedIn has been a
driving force of Microsoft revenue in 2020. As LinkedIn is online, the pandemic has
not severely affected industry revenue as companies view LinkedIn as the easiest
option to hire. This is because it is online and people can still practice social
distancing, and it can be viewed by the large amounts of unemployed who are
looking for jobs. LinkedIn has focused on new product development during this
period, including the complete overhaul of its recruiter platform in 2013.
Additionally, the company has unveiled several new services that are designed to
help users keep track of networking events, job postings and applications on mobile
devices rather than on desktop computers. However, spending on new services has
limited the company's industry-relevant profitability to an extent. The company's
mobile app subscriber base has grown tremendously during the latter half of the
five-year period and now constitutes almost two-thirds of all site traffic. In 2015, the
company also launched its Job Search app for smartphones, which has further
expanded its reach into the online job boards segment. Lastly, the company's recent
acquisition of Bright has significantly boosted its database of open job listings. In
2019 (latest available data), LinkedIn's database had more than 20 million active job
listings.
LinkedIn Corporation (US industry-specific segment) - financial performance*

Year Revenue Growth Operating Income Growth
($m) (% change) ($m) (% change)
2015 1092.2 N/C -55.1 N/C
2016 1296.2 18.7 -19.3 -65.0
2017 826.6 -36.2 -332.1 1620.7
2018 1889.5 128.6 -351.9 6.0
2019 2434 28.8 -146.1 -58.5
2020 2993.1 23.0 -601.8 311.9
Source: Annual report and IBISWorld
Note: *Estimates
36 IBISWorld.com
RANDSTAD HOLDING NV
Market Share: 7.2%

Headquartered in Diemen, Netherlands,
Randstad Holding NV (Randstad) is a
multinational human resource (HR) consulting
firm. Founded in 1960, the company now
employs more than 38,280 corporate
employees in more 4,861 offices across 38
countries globally as of 2019. In 2019, the
company helped place more than 649,000
people in temporary or permanent
employment, with about 260,700 workers
placed in permanent positions. The company's
primary focus is in Western Europe, with North American operations accounting for
only a quarter of total net sales. Across all markets and service offerings, the
company generated net sales of $26.5 billion in 2019. Within North America,
Randstad placed about 26,300 candidates in permanent jobs in 2019.
Randstad provides services through three key business divisions: staffing,

professionals and in-house solutions. The company's staffing category primarily
relates to the provision of employees to clients in the industrial and administrative
sectors. Staff is primarily provided on a temporary basis to these companies; thus,
this segment's revenue is not included in the industry (see IBISWorld report 56132).
Similarly, the company's in-house services provide HR solutions rather than
employment and recruiting services (see IBISWorld report 56133) and are also
excluded from this industry. Therefore, the professional services segment, which is
mostly involved in the permanent placement of professionals in the banking and
finance sectors, is the company's only industry-relevant business unit.
In August 2016, Randstad reached an agreement to purchase Monster Worldwide

Inc. (Monster), the leading HR services provider that owns Monster.com, for $429.0
million. The acquisition will help Randstad further expand its global HR strategy by
bridging two complementary sides of the larger recruiting industry. Monster has
continued to operate as a separate and independent entity under its own name.
Financial performance
The company's performance during the five-year period has been driven by several
major acquisitions as well as organic growth. Prior to the period, the company
acquired SFN Group, another major staffing company, for $771.0 million. While
Randstad's net sales have increased at a healthy rate over the five years to 2020,
industry-specific revenue has slightly lagged total revenue growth. Throughout the
period, professional staffing services have accounted for about the same portion of
industry revenue as they did at the beginning of the period, while the percentage of
revenue attributed to professional staffing services in the United States has slightly
decreased. The company has been adversely affected by the coronavirus
pandemic. Their adverse impact on their EBITA was largely offset by favorable
working capital movements. Industry-specific revenue has decreased an annualized
1.6% to $1.4 billion over the five years to 2020.
37 IBISWorld.com
Randstad Holding NV (US industry-specific segment) - financial performance*

Year Revenue Growth Operating Income Growth
($m) (% change) ($m) (% change)
2015 1473.7 N/C 54.0 N/C
2016 1454.4 -1.3 55.6 3.0
2017 1632.8 12.3 60.3 8.5
2018 1639.4 0.4 56.0 -7.1
2019 1678.3 2.4 60.9 8.8
2020* 1358.8 -19.0 25.7 -57.8
Source: Annual report and IBISWorld
Note: *Estimates
Other Players ADECCO SA
Adecco SA (Adecco) is one of the world's largest temporary staffing agencies. The
Switzerland-based company places about 3.0 million people in employment each
year and is among the largest players in North America. In 2019, Adecco employed
over 33,000 full-time equivalent employees and had more than 600,000 associates
on assignment daily. The company currently has about 5,000 branches in more than
60 countries across the globe and generated $25.7 billion in global revenue in 2019.
Adecco operates through four main business lines: temporary and permanent
career transition, outsourcing, talent development and other services. Temporary
staffing represents the majority of company revenue; however, it is not included in
the Employment and Recruiting Agencies industry, which comprises permanent,
career transition and outsourcing revenue. Adecco contributes to industry services
by accessing a range of candidates, screening resumes and conducting interviews
and assessments.
Demand for permanent placement services has since spiked as rising corporate
profit and higher business sentiment have encouraged employers to seek more full-
time hires. In contrast, the company's temporary staffing unit has slowed down
during the period. The coronavirus pandemic has seen 80% of the company's
employees working from home. They have also developed a custom "Covid-19
Protect" app, that provides health and safety info for associates and e-learning on
staying safe and healthy at work. Additionally, they have provided their clients with
virtual skill lectures and provided free access to webinars and training courses.
Overall, Adecco is expected to generate $11.0 million in US industry-specific
revenue in 2020.
38 IBISWorld.com
Operating Conditions
39 IBISWorld.com
Capital Intensity The level of capital intensity is Low
The Employment and Recruiting Agencies

industry has a very low level of capital
intensity. In 2020, the industry is expected to
invest less than $0.01 in capital for every
dollar spent on labor. Industry services are
traditionally labor-intensive, as companies use
well-trained individuals to screen resumes and
candidates, make recommendations, conduct
interviews and place employees.
The industry has become increasingly

digitalized over the five years to 2020. Online
job listing services have helped revolutionize
the industry and new industry players such as
LinkedIn Corporation and Careerbuilder.com
are now directly competing with other major
players such as Adecco SA and Randstad
Holding NV. These companies are relying on
users that are able to create their own profiles
and browse job listings online. Furthermore,
new software that automatically screens
resumes and candidate profiles have helped
reduce the level of labor required by industry
participants. Capital intensity is expected to
rise slightly over the next five years as online recruitment sites continue to invest in
product development and outperform the industry as a whole.
Technology And Potential Disruptive Innovation: Factors Driving Threat of Change

Systems Level Factor Disruption Description
A measure for the mix of patent classes

Innovation assigned to the industry. A greater
Very High Very Likely concentration of patents in one area
Concentration increases the likelihood of technological
disruption of incumbent operators.
A qualitative measure of barriers to entry.

Fewer barriers to entry increases the
High Ease of Entry Likely likelihood that new entrants can disrupt
incumbents by putting new technologies
to use.
A ranked measure for the number of

Rate of patents assigned to an industry. A faster
Moderate Potential rate of new patent additions to the
Innovation industry increases the likelihood of a
disruptive innovation occurring.
Annualized growth in the number of

enterprises in the industry, ranked against
Low Rate of Entry Unlikely all other industries. A greater intensity of
companies entering an industry increases
the pool of potential disruptors.
40 IBISWorld.com
Level Factor Disruption Description
A ranked measure of the largest core

Market market for the industry. Concentrated core
Low Unlikely markets present a low-end market or new
Concentration market entry point for disruptive
technologies to capture market share.
The industry is adding new patent technologies at a rate in line with the average
across all industries, which suggests a stable addition of technology. However, the
concentration of technologies is high. This creates the potential for innovation
outside the focus of industry leaders to gain traction.
The technological factors supporting the disruptive innovation potential are

connected to an industry structure that is accommodative to new entrants. The
relative ease of entry into the industry magnifies the threat of disruption regardless
of other factors as one-off occurrences are more likely to succeed. However, the
current rate of new entrants is low, suggesting that there is a limited number of new
companies that are potential innovators within the industry.
Major market segments for industry operators are relatively diversified. The spread
of market segments suggests that there are limited entry points other than those
already served my incumbent operators.
The Employment and Recruiting Agencies industry has not

experienced many consequences of technological disruption in
recent years.
The majority of technological developments have enabled industry operators to
streamline their work processes. Most operators now use online job boards and
resume screening software to analyze resumes. Operators will likely be able to
implement any further technological developments similar to this to the benefit of
operators' productivity.
The level of technology change is Medium
The Employment and Recruiting Agencies industry has experienced

a moderate level of technological change in recent years.
Online job listings have become essential employment-seeking tools for clients and
companies in this industry. The ability for applicants to view vacancies and to
submit their resume over the Internet is critical, particularly for applicants hoping to
relocate across the country for employment. Job seekers can also specify which
potential employers can view their resume online. Many websites now offer advice
on resume format and content and career planning. They can also recommend
suitable job openings based on users' specific job preferences.
Screening and testing
Applicant resume screening is now being streamlined with the help

of computer programs.
41 IBISWorld.com
Employment recruiters can filter high volumes of resumes for keywords, experience
requirements and red flags such as typographical errors. Similarly, operators are
developing new methods for reference checks, qualifications checks and interview
procedures. Computer software has made these processes faster, enabling
appropriate candidates to be found and screened with better accuracy. Agencies
keep track of candidates and their resumes on a computerized database; when a
client provides a particular list of demands in a candidate, agencies can quickly
search the database to find an applicant whose background best matches the job
posting.
Some companies now use personality testing to assist in the selection of senior
staff. The tests probe candidates' work style, motivations, interpersonal skills and
ability to work in a group setting. Some tests can be as simple as client meet-and-
greets or as thorough as issuing group case studies at employment selection
centers to test the aptitude of several applicants at once.
Revenue Volatility The level of volatility is High
Note: Revenue growth and decline reflective of 5-year annualized trend. Y-axis is in
logarithmic scale. Y-axis crosses at long-run GDP. X-axis crosses at high volatility
threshold.
The Employment and Recruiting Agencies industry has a high level

of volatility.
Over the five years to 2020, industry revenue grew as much as 11.6% in 2018 and is
expected to decrease by 31.0% in 2020. This decrease in 2020 has increased
revenue volatility in this industry. Demand for industry services depends heavily on
the overall state of the US labor market and changes in the national unemployment
rate. Over the five years to 2020, the unemployment rate had dropped significantly,
however, the unemployment rate is expected to increase 179.8% in 2020 due to the
COVID-19 (Coronavirus) pandemic. This has resulted in a decrease in demand from
job creators, while increasing the demand from job seekers. While there may be an
42 IBISWorld.com
increased demand for industry services from job seekers, operators are unable to
place them as most companies are unwilling to permanently hire people during
times of economic uncertainty. Revenue volatility is expected to increase due to the
sharp decline in 2020.
Although demand for industry services may rise in times of economic duress and
low employment, industry performance typically suffers when the industry is unable
to place individuals successfully into new jobs. As a result, many companies have
expanded their global reach over the past five years to increase job listings and
placement services in emerging markets that have more fluid labor markets than
those in the United States.
Regulation & The level of regulation is Medium and is Steady

Policy
A license is required to operate as an employment agency in most
states.
Licenses are usually issued by the State Department of Labor and may be
renewable on an annual basis. In some states, a counselor's license is also required
for any person who interviews, counsels or advises employers or employees on any
matter related to employment and contracts. Having a license permits agencies to
charge for the provision of services. In addition to the necessary licenses, however,
the Employment and Recruiting Agencies industry is largely self-regulating. The
American Staffing Association has a general Code of Ethics and Good Practices as
well as a code developed specifically for construction companies and day laborers.
The code sets standards for member organizations, such as treating applicants
with respect, maintaining integrity, complying with laws and determining the
qualifications of employees.
Federal and state laws surrounding the use of personal information also regulate
the online industry operators. The federal CAN-SPAM Act, which was signed into
law in 2003, regulates the use of e-mail as a form of communication and sets
standards for the sending of mass e-mail messages. The law limits the type of
communication that online recruitment sites can have with clients and users.
Additionally, each industry operator must clearly state and display its privacy
policies and practices. Private data and information are constantly collected and
stored on these recruiting websites. Accordingly, laws that pertain to the protection
of this data are essential for client and user security and for the websites'
credibility. Furthermore, because of the internet's globalized nature, industry
operators must be willing to comply with the rules and regulations of foreign
governments, which may differ widely from those in the United States.
Demand has reduced for this industry due to social distancing protocols and poor
economic conditions caused by the COVID-19 (Coronavirus) pandemic. This
industry is not considered an essential business; thus, offices have been closed for
a large period of time during 2020. Most companies in this industry are working
completely remotely, the pandemic is expected to accelerate the reliance on
technology in this industry.
43 IBISWorld.com
Industry The level of industry assistance is Low and is Steady

Assistance
The Employment and Recruiting Agencies industry does not receive
any direct form of government assistance.
However, many employment and recruiting agencies in the United States benefit
from various trade associations. The American Staffing Association (ASA) is one of
the most prominent industry associations that works for the benefit of member
companies that work within the Employment and Recruiting Agencies industry. The
ASA provides its affiliates with legal advice, public relations materials, educational
materials for new and established players and provides public advocacy campaigns
to benefit the interests of the industry. The ASA also provides support for member
companies across other industries that provide temporary and contract staffing,
outplacement services, HR consulting and company streamlining activities.
44 IBISWorld.com
Key Statistics
Industry Data
Demand ent rate
2011 18,930 12,202 12,546 11,428 267,454 N/A N/A 11,231 N/A 8.95
2012 18,588 11,888 12,333 11,300 276,733 N/A N/A 10,771 N/A 8.07
2013 18,935 11,458 12,242 11,155 287,890 N/A N/A 10,404 N/A 7.38
2014 20,150 11,880 12,357 11,114 296,026 N/A N/A 10,802 N/A 6.17
2015 20,981 12,546 12,672 11,268 293,526 N/A N/A 11,366 N/A 5.29
2016 22,866 12,952 12,475 11,294 296,404 N/A N/A 11,586 N/A 4.87
2017 24,141 13,034 12,201 11,061 297,903 N/A N/A 11,712 N/A 4.35
2018 26,940 14,648 12,741 11,497 323,082 N/A N/A 12,776 N/A 3.90
2019 27,259 14,839 12,820 11,563 327,567 N/A N/A 12,948 N/A 3.67
2020 18,820 10,847 11,277 10,314 260,462 N/A N/A 10,024 N/A 10.3
2021 19,915 11,835 11,469 10,462 269,906 N/A N/A 10,431 N/A 7.68
2022 21,033 12,349 11,663 10,613 279,419 N/A N/A 10,843 N/A 5.56
2023 21,833 12,714 11,767 10,690 286,133 N/A N/A 11,134 N/A 4.65
2024 22,195 12,877 11,796 10,707 289,073 N/A N/A 11,262 N/A 4.55
2025 22,530 13,030 11,842 10,741 291,911 N/A N/A 11,384 N/A 4.47
Annual Change
Demand ent rate
(%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
2011 10.8 12.7 0 0 10 N/A N/A 11.8 N/A -6.94
2012 -1.81 -2.58 -2 -1 3 N/A N/A -4.10 N/A -9.87
2013 1.86 -3.62 -1 -1 4 N/A N/A -3.42 N/A -8.58
2014 6.41 3.68 1 -0 3 N/A N/A 3.82 N/A -16.4
2015 4.12 5.60 3 1 -1 N/A N/A 5.21 N/A -14.2
2016 8.98 3.23 -2 0 1 N/A N/A 1.93 N/A -8.04
2017 5.57 0.63 -2 -2 1 N/A N/A 1.09 N/A -10.6
2018 11.6 12.4 4 4 8 N/A N/A 9.08 N/A -10.4
2019 1.18 1.30 1 1 1 N/A N/A 1.34 N/A -5.99
2020 -31.0 -26.9 -12 -11 -20 N/A N/A -22.6 N/A 180
2021 5.81 9.10 2 1 4 N/A N/A 4.06 N/A -25.1
2022 5.61 4.34 2 1 4 N/A N/A 3.94 N/A -27.6
2023 3.80 2.95 1 1 2 N/A N/A 2.68 N/A -16.5
2024 1.65 1.27 0 0 1 N/A N/A 1.15 N/A -2.12
2025 1.50 1.19 0 0 1 N/A N/A 1.08 N/A -1.66
Key Ratios
Year IVA/Revenue Imports/Demand Exports/Revenue Revenue per Wages/Revenue Employees per Average Wage
Employee estab.
(%) (%) (%) ($'000) (%)
2011 64.5 N/A N/A 70.8 59.3 21.3 41,991
2012 64.0 N/A N/A 67.2 57.9 22.4 38,923
2013 60.5 N/A N/A 65.8 54.9 23.5 36,137
2014 59.0 N/A N/A 68.1 53.6 24.0 36,489
2015 59.8 N/A N/A 71.5 54.2 23.2 38,721
2016 56.6 N/A N/A 77.1 50.7 23.8 39,087
2017 54.0 N/A N/A 81.0 48.5 24.4 39,315
2018 54.4 N/A N/A 83.4 47.4 25.4 39,543
2019 54.4 N/A N/A 83.2 47.5 25.6 39,527
2020 57.6 N/A N/A 72.3 53.3 23.1 38,485
2021 59.4 N/A N/A 73.8 52.4 23.5 38,648
2022 58.7 N/A N/A 75.3 51.6 24.0 38,804
2023 58.2 N/A N/A 76.3 51.0 24.3 38,910
2024 58.0 N/A N/A 76.8 50.7 24.5 38,959
2025 57.8 N/A N/A 77.2 50.5 24.7 39,000
45 IBISWorld.com
Industry Financial Ratios

April 2018 - March 2019 by company revenue
Liquidity Ratios April 2015 - April 2016 - April 2017 - April 2018 - Small (< Medium Large (>
March 2016 March 2017 March 2018 March 2019 $10m) ($10m-50m) $50m)
Current Ratio 1.5 1.5 1.6 1.6 1.2 1.8 1.6
Quick Ratio 1.4 1.4 1.5 1.5 1.1 1.6 1.5
Sales / Receivables (Trade Receivables Turnover) 8.4 8.2 8.1 8.8 11.6 9.1 7.5
Days' Receivables 43.5 44.5 45.1 41.5 31.5 40.1 48.7
Cost of Sales / Inventory (Inventory Turnover) 999.9 999.9 999.9 999.9 999.9 999.9 999.9
Days' Inventory 0.4 0.4 0.4 0.4 0.4 0.4
Cost of Sales / Payables (Payables Turnover) 144.7 137.5 132.0 130.9 384.8 151.8 72.7
Days' Payables 2.5 2.7 2.8 2.8 0.9 2.4 5.0
Sales / Working Capital 19.0 18.7 18.1 19.3 46.4 18.4 17.3
Coverage Ratios
Earnings Before Interest & Taxes (EBIT) / Interest 7.7 7.0 6.6 7.1 5.3 9.5 6.4
Net Profit + Dep., Depletion, Amort. / Current 7.4 6.6 9.0 7.0 7.2
Maturities LT Debt
Leverage Ratios
Fixed Assets / Net Worth 0.1 0.1 0.1 0.1 0.1 0.1 0.1
Debt / Net Worth 2.1 2.2 2.1 2.1 3.6 1.2 2.4
Tangible Net Worth 25.4 20.1 26.0 23.6 7.5 31.9 25.1
Operating Ratios
Profit before Taxes / Net Worth, % 40.0 34.4 40.5 38.9 31.0 42.2 35.6
Profit before Taxes / Total Assets, % 11.7 10.1 10.3 12.3 10.6 15.8 9.5
Sales / Net Fixed Assets 228.2 190.9 212.8 208.0 236.1 217.7 134.7
Sales / Total Assets (Asset Turnover) 5.2 4.9 5.2 5.3 5.8 5.7 4.8
Cash Flow & Debt Service Ratios (% of sales)
Cash from Trading 19.1 19.8 20.0 22.5 29.2 22.1 17.1
Cash after Operations 1.9 2.5 2.6 2.9 2.7 3.0 2.5
Net Cash after Operations 1.9 2.6 2.3 2.7 2.7 3.5 2.4
Cash after Debt Amortization -0.1 0.6 -0.1 0.7 0.2 1.1 0.5
Debt Service P&I Coverage 2.8 4.7 2.4 3.7 2.2 7.0 2.4
Interest Coverage (Operating Cash) 5.0 7.2 4.9 5.5 3.3 8.9 4.5
Assets, %
Cash & Equivalents 13.6 12.4 13.7 15.7 24.3 15.5 9.3
Trade Receivables (net) 59.6 58.3 58.5 56.6 45.0 60.7 60.1
Inventory 0.3 0.2 0.2 0.1 0.0 0.2 0.1
All Other Current Assets 5.5 4.6 5.0 5.7 6.7 5.2 5.7
Total Current Assets 79.0 75.5 77.4 78.1 76.0 81.6 75.2
Fixed Assets (net) 5.9 5.7 4.9 5.1 6.8 4.3 4.8
Intangibles (net) 7.5 11.0 9.1 7.9 6.6 6.3 11.1
All Other Non-Current Assets 7.6 7.8 8.7 8.8 10.6 7.7 8.9
Total Assets 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Total Assets ($m) 5,183.5 5,351.2 5,438.4 5,374.7 224.6 730.4 4,419.6
Liabilities, %
Notes Payable-Short Term 23.5 22.9 23.1 25.6 37.9 25.6 16.0
Current Maturities L/T/D 2.4 1.7 1.1 1.4 1.2 1.8 1.1
Trade Payables 8.6 7.2 7.0 9.6 10.9 7.7 11.1
Income Taxes Payable 0.4 0.2 0.2 0.2 0.0 0.3 0.3
All Other Current Liabilities 19.0 19.3 18.5 19.4 24.9 16.5 19.0
Total Current Liabilities 53.9 51.3 50.0 56.3 75.0 51.9 47.5
Long Term Debt 7.6 9.3 7.2 7.7 8.1 4.7 11.2
Deferred Taxes 0.1 0.2 0.1 0.2 0.1 0.2 0.3
All Other Non-Current Liabilities 5.4 8.0 7.6 4.4 2.7 5.0 4.8
Net Worth 32.9 31.1 35.1 31.5 14.1 38.2 36.2
Total Liabilities & Net Worth ($m) 5,183.5 5,351.2 5,438.4 5,374.7 224.6 730.4 4,419.6
Maximum No. of Statements Used 377.0 354.0 339.0 338.0 85.0 144.0 109.0
Source: RMA Annual Statement Studies, rmahq.org. RMA data for all industries is derived directly from more than 260,000 statements of member
financial institution's borrowers and prospects.
46 IBISWorld.com
Additional Resources
Additional United States Staffing Association
Resources http://www.usstaffing.org
American Staffing Association

http://www.americanstaffing.net
National Association of Personnel Services

http://www.naps360.org
The Association of Recruitment Consultancies

http://www.arc-org.net
US Census Bureau
http://www.census.gov
Industry Jargon IN-HOUSE

The opposite of outsourcing; performing a duty or task within the company itself, rather than
through an outside source.
OUTPLACEMENT SERVICES
Services provided to a terminated employee to assist their search for a new job.
OUTSOURCING
The use of outside service providers to perform various noncore activities.
Glossary Terms BARRIERS TO ENTRY

High barriers to entry mean that new companies struggle to enter an industry, while low
barriers mean it is easy for new companies to enter an industry.
CAPITAL INTENSITY
Compares the amount of money spent on capital (plant, machinery and equipment) with
that spent on labor. IBISWorld uses the ratio of depreciation to wages as a proxy for capital
intensity. High capital intensity is more than $0.333 of capital to $1 of labor; medium is
$0.125 to $0.333 of capital to $1 of labor; low is less than $0.125 of capital for every $1 of
labor.
47 IBISWorld.com
CONSTANT PRICES
The dollar figures in the Key Statistics table, including forecasts, are adjusted for inflation
using the current year (i.e. year published) as the base year. This removes the impact of
changes in the purchasing power of the dollar, leaving only the "real" growth or decline in
industry metrics. The inflation adjustments in IBISWorld’s reports are made using the US
Bureau of Economic Analysis’ implicit GDP price deflator.
DOMESTIC DEMAND
Spending on industry goods and services within the United States, regardless of their
country of origin. It is derived by adding imports to industry revenue, and then subtracting
exports.
EMPLOYMENT
The number of permanent, part-time, temporary and seasonal employees, working
proprietors, partners, managers and executives within the industry.
ENTERPRISE
A division that is separately managed and keeps management accounts. Each enterprise
consists of one or more establishments that are under common ownership or control.
ESTABLISHMENT
The smallest type of accounting unit within an enterprise, an establishment is a single
physical location where business is conducted or where services or industrial operations are
performed. Multiple establishments under common control make up an enterprise.
EXPORTS
Total value of industry goods and services sold by US companies to customers abroad.
IMPORTS
Total value of industry goods and services brought in from foreign countries to be sold in
the United States.
INDUSTRY CONCENTRATION
An indicator of the dominance of the top four players in an industry. Concentration is
considered high if the top players account for more than 70% of industry revenue. Medium
is 40% to 70% of industry revenue. Low is less than 40%.
INDUSTRY REVENUE
The total sales of industry goods and services (exclusive of excise and sales tax); subsidies
on production; all other operating income from outside the firm (such as commission
income, repair and service income, and rent, leasing and hiring income); and capital work
done by rental or lease. Receipts from interest royalties, dividends and the sale of fixed
tangible assets are excluded.
48 IBISWorld.com
INDUSTRY VALUE ADDED (IVA)

The market value of goods and services produced by the industry minus the cost of goods
and services used in production. IVA is also described as the industry's contribution to GDP,
or profit plus wages and depreciation.
INTERNATIONAL TRADE
The level of international trade is determined by ratios of exports to revenue and imports to
domestic demand. For exports/revenue: low is less than 5%, medium is 5% to 20%, and high
is more than 20%. Imports/domestic demand: low is less than 5%, medium is 5% to 35%,
and high is more than 35%.
LIFE CYCLE
All industries go through periods of growth, maturity and decline. IBISWorld determines an
industry's life cycle by considering its growth rate (measured by IVA) compared with GDP;
the growth rate of the number of establishments; the amount of change the industry's
products are undergoing; the rate of technological change; and the level of customer
acceptance of industry products and services.
NONEMPLOYING ESTABLISHMENT
Businesses with no paid employment or payroll, also known as nonemployers. These are
mostly set up by self-employed individuals.
PROFIT
IBISWorld uses earnings before interest and tax (EBIT) as an indicator of a company’s
profitability. It is calculated as revenue minus expenses, excluding interest and tax.
REGIONS
West | CA, NV, OR, WA, HI, AK
Great Lakes | OH, IN, IL, WI, MI
Mid-Atlantic | NY, NJ, PA, DE, MD
New England | ME, NH, VT, MA, CT, RI
Plains | MN, IA, MO, KS, NE, SD, ND
Rocky Mountains | CO, UT, WY, ID, MT
Southeast | VA, WV, KY, TN, AR, LA, MS, AL, GA, FL, SC, NC
Southwest | OK, TX, NM, AZ
VOLATILITY
The level of volatility is determined by averaging the absolute change in revenue in each of
the past five years. Volatility levels: very high is more than ±20%; high volatility is ±10% to
±20%; moderate volatility is ±3% to ±10%; and low volatility is less than ±3%.
49 IBISWorld.com
WAGES
The gross total wages and salaries of all employees in the industry.
50 IBISWorld.com
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Employment - Recruiting Agencies in The US Industry Report

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Employment - Recruiting Agencies in The US Industry Report

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US INDUSTRY (NAICS) REPORT 56131

Employment & Recruiting Agencies in the US

IBISWorld.com +1-800-330-3772 info@IBISWorld.com

About This Industry...........................................5 Competitive Landscape...................................27

Industry Definition..........................................................5 Market Share Concentration....................................... 27

Industry at a Glance.......................................... 7 Major Companies............................................ 35

Executive Summary....................................................... 9 Major Players............................................................... 35

Products and Markets..................................... 20 Industry Data................................................................45

· Employment and Recruiting Agencies industry revenue is expected to decline in

· COVID-19 (coronavirus) can be viewed as an external threat to this industry as it is

About This Industry

Major Players LinkedIn Corp.

Main Activities The primary activities of this industry:

Operating employment agencies or registries

Operating employment referral agencies or registries

Providing permanent placement services

Providing temporary placement services

Providing online job and resume listing services

The major products and services in this industry:

Executive search services

Temporary staffing services

Independent contractor placement services

RELATED INTERNATIONAL INDUSTRIES

-2.2% 3.7% Industry Structure

4.2% Life Cycle Regulation

Annual Growth Annual Growth Technology Change

-1.8% 0.8% Key Trends

Products & Services Segmentation

48.1% 34.7% 7.8% 6.0% 3.4%

Major Players % = share of industry revenue SWOT

Executive The Employment and Recruiting Agencies industry has not

Industry performance is dependent on the national unemployment rate, corporate

Key External National unemployment rate

External competition for the Employment and Recruiting Agencies industry

Current The Employment and Recruiting Agencies industry consists of

COVID-19 (coronavirus) pandemic

The coronavirus pandemic is expected to have an adverse effect on

Employment opportunities decline

This industry's success is highly dependent on changes in the

Digital winners and losers

Over the past five years, widespread adoption of broadband internet

Traditional recruiting services provided by well-established operators such as

Profitability and industry structure

Industry profit (measured as earnings before interest and taxes) is

Historical Performance Data

Job openings provide growth

Online tools will continue to support the search-submitted applications of both

Traditional industry operators, such as major players Randstad Holding NV and

Profit and expansion

Industry profitability is expected to increase over the five years to

Technological innovation will continue to lower barriers to entry, encouraging new

Performance Outlook Data

LIFE CYCLE REASONS

Technological change is quickly altering the way the industry operates

The industry is expected to continue consolidating, although it remains highly fragmented

The industry is characterized by a moderate rate of technological change, a growing

The industry is undergoing significant change, driven primarily by the widespread

The coronavirus pandemic is expected to hurt industry performance in 2020 and

Products and Markets

Permanent placement services

Permanent placement services are estimated to account for 48.1%

Executive search services

Executive search services are forecast to comprise 34.7% of