Recruiters can look forward to stable times ahead and need not be unduly concerned by the rise in unemployment.

That was the message from Sue Dodd, of Agile Intelligence, as she addressed the Forum of Professional Recruiters in London last week. Dodd pointed to the rise in unemployment (see page 8) and noted that, for many years, there was a connection between higher unemployment and lower turnover for the industry.

But she added that this relationship had broken down to some extent recently as the industry progressed towards a higher-value staffing mix with the growth of professional sector recruitment. 
Dodd said margins were still coming under pressure and pointed to Adecco having admitted to weaker UK margins. She said it was “giving away margin” on the assumption it could be restored by cutting its costs. 

Agencies that had built their capabilities had a unique service proposition and had good candidate capture could maintain margins, she said. They could avoid the pitfalls that some general recruiters had fallen into.

She said: “I can’t think of a single generalist recruiter that isn’t trying to segment its business at the moment.” 
Data from the Office for National Statistics showed staffing firms generated £26.6bn of turnover in 2005, up 1.8% from 2004. Data for the first quarter in 2006 showed turnover provisionally up 18.6% on a year ago.