New Challenges That Staffing Firms Will Face in 2020

In Ironwood Insights by

With unemployment at its lowest level since 1969, it is more challenging than ever for businesses to find the best, most talented employees. There are more jobs available and fewer talented people to fill them, which has led to greater selectivity and willingness to change jobs if a better offer comes along.

In addition, employers have to compete to hire the best talent. They need to offer more of what candidates want to incentivize the top talent to come to them. The trick is in determining what that is.

Staffing firms provide a valuable service because they have employees that can be hired out to businesses for anywhere from a few months to a few years, depending on the business’s needs. The challenge in 2020 is in attracting and retaining the top talent in a workforce that has options. Take a look at some of the challenges facing staffing firms in 2020.

The Candidates Control the Market

In the United States, there are more open jobs than there are qualified candidates. This is a matter of simple supply and demand and the candidates have the edge. A skilled candidate can pick and choose what he or she wishes to do and staffing firms need to stand out to attract the top talent.

Another issue is that candidates have more resources to find the jobs they want than ever before. Technology can connect candidates with potential jobs, which means that staffing firms have to offer a lot more to draw candidates.

Under different circumstances, recruiters would interview candidates and look through resumes to choose the best candidates for their jobs but this is not an option today. Instead, staffing firms need to find ways to draw the best candidates to them.

How to Draw the Best Candidates

It is necessary to change with the current trends to draw the best candidates for your company. Staffing firms need to develop a vision for how they fit into today’s technologically connected, relationship-oriented world. Take a look at the following:

  • Use technology to engage candidates: Email and social media sites allow for constant communication and staffing firms need to remind candidates that they are there. In addition, many members of the younger workforce accept texting as a form of communication. Use these outlets to keep candidates engaged throughout the interview and hiring process.
  • Find new ways to recruit: It is becoming commonplace for recruiters to use social media, including Facebook and Instagram, to find and recruit candidates. Start by having a social media presence. Don’t discount online communities such as LinkedIn and Reddit as these are great places to find talent.
  • Build your brand reputation: Candidates can pick and choose and they are demanding more from companies. Many candidates express that they expect to work with a company that is socially responsible. Staffing firms need to define their culture and gear recruiting towards it. Think about your ideal candidate and start branding. Be consistent and develop a reputation that draws the top talent.
  • Simplify the hiring process: Technology makes it possible for candidates to apply for jobs online and follow the process through a dashboard. This fits in well with today’s instant-gratification world. Often the hiring process is long and drawn out and candidates take another job before they are invited to return for a second interview. Make the hiring process simple and you might attract more candidates.
  • Have flexible job descriptions: It is common for people to do extra work on the side and candidates want to know that this is an option. Change your job descriptions to allow for working remotely in addition to working for your clients. The more flexible you can be, the more diverse candidate pool you will draw.

The Rise of “Ghosting”

Ghosting happens when you have candidates who start assignments and leave after a few days as well as those who never show up. This trend is on the rise because there are more jobs than candidates out there right now and is an evergrowing challenge that staffing firms will face.

This can be detrimental to a staffing firm because the client is depending on them to provide the employee. Not only does it interfere in this relationship but you lose money and time spent recruiting and training the employee.

Ghosting can take the following forms:

  • Interview no-show
  • First-day no-show
  • Quitting without notice

The best way to counteract the growing trend of ghosting is to develop engaging interactions with your candidates and meaningful relationships with your employees. It is necessary to change the mindset of the staffing firm from one of recruiting for a particular job to one of hiring talented candidates. This approach is more of a sales approach where you need to sell your company to candidates.

By showing a talented candidate that he or she matters and backing it up with meaningful interactions, you are more likely to have a chance. Sell your company, let candidates know they are valuable, and show them what you can offer that is unique. Engage in meaningful interactions and you can reduce ghosting for your firm.

Stand Out Through Specialization

With so many open jobs and fewer talented candidates to fill them, you might have trouble drawing the best. When you offer specialized talent, you may be able to fill a corner of the market that is less saturated.

Rather than offering generalized candidates to fill temporary positions, offer specialized candidates who can help in the short or long term. If you become the go-to staffing firm for a specialized niche, you may have less trouble finding qualified candidates and getting contracts for them.

Update Your Technology

Everything is online today and you need to stay on top of the latest trends to stay in the game. If you don’t update your technology, you will quickly be left behind not only in terms of finding companies to work with but also in terms of finding candidates who come to your staffing firm.

Online resources such as Glassdoor or LinkedIn offer millions of jobs to millions of qualified candidates. They make it simple to apply for and find jobs. As a staffing firm, you need to be right in the middle of it and you need to find ways to stand out and send the message that your alternative is the best choice.

Update your technology to make sure that you can remain competitive and come up with a way to market what you do. The key is to draw candidates and show them why you are the best option available. By doing so, you will come out on top.

Candidates Want Benefits

If you find a candidate who you want to hire, make sure that you do consider the benefits that candidates expect. If you give a low salary offer, you may just send him or her running out the door. Because it’s a job seeker’s market, you can offer these benefits to attract the best candidates:

  • Moving costs
  • Medical and dental coverage
  • 401k plan
  • Remote work options
  • Personal development and training

Candidates want more out of their jobs today and you need to offer what they want to draw them in and keep them.

It’s All About Relationships

All of the changes and challenges boil down to one thing, which is that people are relationship-driven more than ever before. It’s not enough to offer a good job. Candidates want to be valued and feel important. It’s not enough to offer the right candidate to a client; the client wants more.

Much as with retailers and other businesses, staffing firms need to turn to relationship management and employ it across the board. This means making meaningful connections with candidates, employees, and clients so that they feel valued and important.

People want more personal experiences and you need to provide them. For candidates, be sure to have meaningful engagements throughout the hiring process and sell them on your brand’s culture. Make them feel as if they are a part of something bigger. To do this, you need to outline the vision for your staffing firm.

People want to know that they can improve their skills and personal development opportunities are important to many. In addition, this will build your reputation with your clients because they will know that you are not stagnant and are keeping up with the current trends.

It is critical to make sure that your technology is current and to stay on top of trends. Technology is the means to developing relationships today as people expect to be connected online and many prefer the simplicity and ease of using these tools.

In a job seeker’s market, you cannot afford to sit back and wait for the top talent to come to you. Even if you find them, you have to find a way to stand out and attract them to your firm. The best way to face all of the challenges of an evolving workplace in 2020 is to stay on top of it. Update your technology and take a relationship-centric approach. Make sure that people who are important to your business know it and feel valued.


It Matters with Matt

Written by Matt Rojas

Rojas is a Senior Lending Officer, ISO Manager, Underwriter, and Factoring Specialist for Ironwood Finance since 2015. His team provides educational information to the small business community, which covers topics such as business financing, education, customer service, and much more. If you’d like to see a topic covered on the Ironwood Finance blog, or be featured please email him at




 Receive more tips for your small business by subscribing to our newsletter:

Merchant Cash Advances, Why Do ISOs Struggle, Best Small Business Apps, Morning Routines of Successful People, ironwood finance, small business, funding, business tips