Why recruitment agencies are living on borrowed time.

Why recruitment agencies are living on borrowed time.

I believe in 10 years times there won’t be any need for high street recruitment agencies and I bet by the end of reading this you’ll agree with me.

You’re probably thinking, “Doubt it. There are hundreds of recruitment agencies, thousands maybe, there’s just too much demand”. Well you’re not wrong, according to Companies’ House as of January there are 27,788 recruitment agencies registered in the UK.  302 of which were registered in January alone.

It’s true, recruitment is a huge multifaceted industry which is still growing today. So why do I believe they’re living on borrowed time when 27,788 recruitment agencies clearly think otherwise?

Well, if you want to predict the future you should look at the past. So let’s rewind 10 years or so and examine some other huge multifaceted industries.


A good place to start as it’s an industry we are all familiar with. Let’s set the scene, it’s 2007- Gordon Brown is the PM. Maybe you’re watching the Wembley stadium opening ceremony on tv while worrying about your savings in Northern Rock. Let’s say you fancy watching a film, so you get in the car and head to Blockbusters…

You see where I’m going with this. Blockbuster closed in 2013 after turning down an opportunity to be bought out by Netflix.  Opening doors in 2010, Netflix is now worth a mind blowing $70 Billion with its stock value rising 30% this year alone.  It’s not just Blockbusters too; Zavvi, Game, JJB Sports. All closed or bought out. Christmas 2016; 1 in 4 pounds spent on Christmas presents went to Amazon.com.


Back in the day if you wanted to order a taxi you’d call a taxi firm. You’d probably even have your local taxi number memorised or stored in your phone. Not anymore.

Traditional cab firms are rapidly being side-lined by modern app based services such as Lyft and Uber. Since its formation in 2013 Uber has now grown to be worth over $26 billion worldwide. All without owning a single car. Alongside this sales of traditional UK A-Z road maps sales dropped 30% between 2006 and 2015 as sat-navs became a standard on people’s phones.


Sadly, the age of traditional paper bound or hardback books has passed.  10 years ago, the high street book store was a staple but with the advent of the e-book everything changed. Borders closed in 2009 and other high street bookstores are following suit.  In 2009 the physical book market dropped by £150 million, meanwhile the e-book market has grown £370 million.  E-books are easier and better for the consumer and for writers. Self-publishing gives control back to writers and allows readers access to a wider range.  While traditional publishers cling on still, they are rapidly being pushed out as the need for middle men publishers in the industry declines.


Now, I’m ending on travel as the business model for the high street travel agent is surprisingly close to that of a high street recruitment agent. 10 years ago, if you wanted to go on holiday your first stop would be a travel agent. You’d go in and speak with a friendly travel agent who would look through their books and hook you up with your dream holiday.

Now, we say “Bon voyage” to the high street travel agent because there is simply no need to involve a middle man when you can plan your holiday from your sofa. The global travel company MyTravel merged with Thomas Cook in 2007 to combine their strengths as two competing high street travel companies. In 2012, they posted a loss of £157 million and continue to struggle today.  Meanwhile Airbnb became the biggest hotel company in the world without owning a single hotel. Hotel resorts and restaurants live and die by their Tripadvisor reviews whilst people go on impromptu holidays courtesy of Lastminute.com.

The common elements in all the above? Goodbye middlemen industries, hello software. Across our modern life we are trading in the physical for the digital. Why speak to a travel agent when you can access more information from your phone than their brochures will ever hold? Why go out to rent a film when you can stream it over the internet?  We are entering the age of software and industries big and small are being disrupted by apps and big data. Bigger industries than recruitment have, and are being been toppled by the software revolution.

Let’s go back and think again about those 27,788 recruitment agencies. 27,788 is a sizeable number – there must be hundreds of thousands of companies looking for new employees and even more applicants looking for that perfect role. It’s clear that we, as a society, are willing to ditch the middleman for the right software, we’ve all done it after all.

So, what happens when the right recruitment software comes along? The right app, utilizing big data in a way that traditional recruitment agencies don’t?  Think again about all that demand which at first makes the industry seem so stable…

Did I convince you?


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