The global pandemic the past year has furthered our reliance on technology for many things, including searching for a job. This has the potential to disrupt staffing in many different ways.
To help identify what these disturbances are, members of the Talent Tech Labs team Jonathan Kestenbaum and Jonathan Covey offered more details along with reasons why staffing professionals should not worry about a tech takeover.
According to the pair, the disruptive technologies in staffing include the following:
The direct sourcing threat poses an opportunity for trusted suppliers
As Talent Tech Labs defines it, direct sourcing is procurement deciding that they can build their own placements because they have staffing suppliers that are giving them talent. With a little bit of tech they can become a staffing firm, according to Kestenbaum, Talent Tech Lab’s Co-Founder and Managing Director.
But he assured that technology can’t do the whole process for them.
“There’s a lot of hard work that staffing firms put into selecting and engaging with candidates and putting them on payroll,” he said.
E-staffing companies are starting to white-label their solutions
E-staffing, as they describe it, is basically a category that’s a staffing firm enabled by technology. Tech is made to do the same processes seamlessly.
“You can feature a candidate to employers, then they can be interested, ready and vetted and then those employers can decide to have an interview with the candidate once its scheduled and a fee is charged just like staffing firm,” Kestenbaum said. “But I would argue that they’re still using people.”
He goes on to explain that e-staffing companies take a tech-first approach to “sourcing-as-a-service.” They strike a balance between the human touch of an RPO and an automated temp labor marketplace.
Temp labor marketplaces are starting to look like staffing firms
Temporary labor marketplaces include companies such as Upwork, Field Nation and Catalant.
“FMS is emerging from the temp labor marketplaces and it turns out that you need a real enterprise system to actually manage the compliance and efficiency to be able to engage this type of labor,” Covey, an analyst at Talent Tech Labs, said.
Deployment systems transforming shift-based work, but requiring big change
Deployment systems are technologies that staffing firms can leverage to deploy shift-based contractors out into the workforce.
“I’ll give an example,” Kestenbaum said. “We knew of a company using a deployment platform that said ‘Hey, just plug our tech in and you basically have a staffing firm.’ These vendors think it’s that simple, but they’re missing all the things that you are intimately aware of.”
He continues to share that because of the disconnect, one can’t have data flowing seamlessly to candidates. Therefore, it’s not instantaneous. They work but not if you want to capture a large portion of the market, he said.
Recruitment marketplaces moving towards perm placement VMS model
A recruitment marketplace is essentially a temp labor marketplace of recruiters. Independent recruiters work on many of these platforms, Kestenbaum explained.
It matters because many companies struggle with skill shortages, especially in highly technical areas. Recruitment Marketplaces combine these suppliers into a unified platform and assume the role of a VMS to supply candidates to clients at a fraction of the cost.
But despite the development of so many technologies, Kestenbaum does not believe this means a total tech takeover will be in our midst any time soon, but that ultimately the solution is going to be a combination of what he calls “tech and touch.”
“You can’t take the human out of human resources,” he said. “There’s no matching algorithm I can see that’s going to completely disintermediate staffing. You’ll always need, I believe, a staffing firm to be there to get the candidate interested in the role because they can be matched to a job, but they have to be sold to the job.”
