Recruitment Consulting in the Age of Corona: Decline or Opportunity?

During the global financial crisis, Germany’s recruitment consultants experienced a revenue drop of 26.2% compared to the previous year, according to the Federal Association of Management Consultants (BDU). What losses will the industry endure in the year of the Corona crisis? The outlook isn’t promising. The International Monetary Fund (IMF) predicts a deeper recession in 2020 than in 2009. It’s a tough time for external recruiters. Companies are imposing hiring freezes and holding back investments. Naturally, even during and after the crisis, employees will be needed, but HR departments will have to decide whether to assign recruitment mandates or conduct searches themselves.

Is there still a need for recruitment consultants?

This crisis is accelerating a trend that had already begun: The recruitment industry is professionalizing and is in the midst of a digital transformation process. Unscrupulous headhunters are fading away, processes are becoming more digital, efficient, and much more transparent thanks to GDPR and others. Corona is speeding up these developments rapidly. Even some established recruitment consultants will have to evaluate whether they can keep up. All recruitment professionals must convincingly demonstrate to their clients that their services are indispensable now and in the post-Corona world.

However, the crisis could be the perfect time to make organizations more efficient and strengthen their unique selling points. Ultimately, it’s about matching candidates who are hard to reach or inaccessible to HR departments. But how can recruitment consultants distinguish themselves in a digital world with seemingly open access to candidates via social media? We have identified six relevant topics in recruiting that are important now and will be in the future.

1. Successful recruitment consultants specialize in one or a few industries and job groups

   According to a study by the Federal Association of Human Resource Managers (BPM), HR leaders trust external recruiters with in-depth industry expertise. Not only that: 82% prefer recruitment consultants who specialize in specific job groups. Successful recruiters thus position themselves in one industry and area of expertise. For HR managers, these recruitment consultants are the first and often only point of contact when they need an industry-savvy specialist or executive.

2. From recruitment consulting to HR consulting

   Beyond candidate identification, direct approach, and pre-selection, recruiters will increasingly operate in adjacent HR consulting fields and accompany the entire recruiting process. This requires a holistic consulting approach, which extends well beyond the core business to include additional HR content. Successful recruitment consultants speak the language of their industry, collaborate with strategic service partners, and expand their interdisciplinary team by employing experts with industry relevance. This includes, for example, change managers, PR and communications specialists, and experts in leadership or executive consulting.

3. Recruitment consultants becoming career coaches and decision aids

   A new type of leader is emerging. In the coming years, young, well-educated managers who are highly networked and digital-savvy will take the helm. They know exactly what options they have and what skills are in demand. The new role of recruitment consultants resembles that of sports agents in professional sports. They will professionally guide candidates in decision-making, coach them, and showcase career paths. Therefore, interesting candidates should not only be approached when a concrete vacancy exists. Successful recruitment consultants know the top candidates in their industry, so they can make the right offer at the right time.

4. Data protection as a key measure of recruiting professionalism

   The BPM study makes it clear: For nearly 80% of HR professionals surveyed, transparent recruiting processes are important, and for 10%, they are crucial. Recruitment firms are therefore forced to implement transparent, fully digital, and standardized processes. This poses a significant challenge for many companies but also serves as a differentiating factor if data protection is professionally and seriously executed.

5. HR departments expect flexible “just in time” recruiting

   Interim management, project-based employment, and increased turnover in some industries lead to more speed. Additionally, the implementation of digitization, which is currently of top priority in many companies, increases the pressure to act in HR departments. They need more support to fill required positions quickly and appropriately.

Digital and Intelligent Technologies Make Recruiting More Efficient

Digital technologies will take over standardized tasks and processes in recruiting, making them more efficient through automation. Artificial intelligence will deliver perfectly matched candidates, with selection based on complex analytics of multiple data streams, which can no longer be handled manually. The role of the recruitment consultant will be to manage these results. This requires technical and industry-specific expertise and an understanding of company culture to find the right match. This is something artificial intelligence can’t achieve, as it requires the empathy of the recruiter, which will continue to be important in the future.