2018 was a record-breaking year for permanent sales, with larger recruitment agencies leading the pack.


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Find out how you measured up against some of the best performers and why small agencies struggle. Recent permanent sales trends provide valuable insight into the state of the recruitment industry. When perm sales are high, so too is business confidence – and, in turn, agency results. According to Nigel Harse of Staffing Industry Metrics, recruitment agencies across Australia reported record perm sales growth in 2018, reflecting the strongest market conditions in a decade.

After analysing data from 102 recruitment agencies in Australia, Staffing Industry Metrics found that 68% of recruitment agencies recorded improvement on 2017 perm sales. Of the remaining agencies, 18% reported similar results to 2017 and 14% reported a decline in perm sales compared to 2017.

Small recruitment agencies struggle reporting modest growth

Recruitment agencies with less than 10 employees reported small but steady growth in 2018. These firms averaged a 3% to 6% annual increase in perm sales for 2018 compared to 2% to 4% growth in 2017.
While the average growth in small teams was unremarkable, some firms performed at the top of their game, achieving growth in excess of 20% and establishing a significant foothold in the perm market. Conversely, some firms failed to capitalise on buoyant market conditions. Our insight suggests that, if your permanent sales were around $1m in 2018, you may have missed the boat.
Recruitment agencies with between 11 and 20 employees were the star performers of 2018. These agencies reported year on year average perm sales growth of 20% to 22% in 2018 – a significant improvement on 2017 results which averaged 2% to 5% growth. Again, there were standouts in this field, with the top 10% in this peer group achieving perm sales growth in excess of 30%.

Perm sales predictions for 2019

While 2018 was a record-breaking year for perm sales, the early signs from December data suggests a bumpy start for 2019. Historically, many recruitment agencies report poor perm sales in December, as hiring comes to a halt around the festive season. However, December 2018 figures show a sharper, more widespread decline than usual.

A likely reason for the decline is the huge spike in staff churn across recruitment agencies, which has been on the rise since July 2018. It peaked at an average of 42% to 47% in December – the worst we’ve seen for several years.

Staff turn over 4 year trend


The concern when staff churn is high, particularly for small and permanent dependent agencies, is their reduced capacity to fill roles, which means billings fall away fast. In these times, when it’s tough to say “no”, there’s a temptation to cast a wider net on different types of roles.

However, when agencies work on roles that aren’t part of their core business strategy, efficiency inevitably drops off. Every one-off job is like a work of art, as candidates aren’t suitable for other roles – the talent pool is left to waste. Then, when the market drops, these agencies are left without a clear focus on their core markets, roles or clients.

How to ensure your agency thrives in a changing market

With the federal election looming and the full force of Brexit yet to be felt, changes are imminent for the Australian recruitment industry. To ensure success in 2019, it’s vital to make strategic decisions and not be led by market demand which may spread your knowledge and experience thin. Decide quickly which clients you want to work with – and what type of roles you want to fill.

Most of all, put more time and energy into increasing staff retention. Recruitment agencies that can steady the ship and combat high staff turnover are best placed for success in 2019.

How does your recruitment agency measure up?

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