Recruitment agencies that adopted AI and automation were more likely to grow in 2023
63% of recruitment agencies are experimenting with AI, according to Bullhorn research
SYDNEY — 1 March 2024 — Although 2023 was a challenging economic climate for the recruitment industry, agencies that adopted AI and automation technologies and improved productivity were more likely to see revenue gains, according to Bullhorn’s Global Recruitment Insights and Data (GRID) 2024 Industry Trends Report.
In 2023, the number of recruitment agencies reporting revenue growth declined for the first time in three years. Despite market headwinds, 54% of survey respondents still saw revenue increase. These high-performing recruitment agencies had something in common: they were further in their digital transformation journeys and shared a focus on increasing productivity and efficiency.
High performers are experimenting with AI
In the APAC region, 63% of agencies began experimenting with AI in 2023. High-performing agencies have higher adoption rates of AI tools. They are 4.5 times as likely to be using AI to help with interviews and more than three times as likely to be using it for candidate onboarding.
High performers used more advanced automations
Agencies that heavily leverage automation were 50% more likely to have seen revenue growth in 2023. These high-performing agencies used automation for tasks such as job matching and time capture, creating a smoother experience for all. Respondents that reported “excellent” success at winning new business were five times more likely to have automated candidate screening, and agencies that saw revenue growth were 25% more likely to have automated tools to help nurture client relationships.
High performers drove more top-of-funnel activity
Agencies that saw the highest revenue gains used technology to move candidates through the recruitment process faster and ultimately make more placements. They did so in part by getting creative with candidate incentives and investing in the talent experience to entice more high-quality candidates. The highest-performing agencies placed candidates in less than 20 days.
Getting ahead of the competition remains a priority in 2024
The top challenge for 2024 reported by survey respondents is uncertainty over the economy and future growth (cited by 58% of respondents), although 68% of agencies expect the economy to improve in 2024 and 61% expect their revenue to increase this year. Aligned with this outlook, the top priority of recruitment agencies this year is winning new business (cited by 40% of respondents), followed by digital transformation (38%) and improving the candidate experience (28%). Another challenge that gained increased importance this year was competition from online freelance/gig platforms, with 33% of respondents citing this as a top challenge, compared with just 14% in 2022.
“Last year, the industry witnessed a shift in the market dynamics for the first time in a number of years, as the spotlight shifted from sourcing candidates to a focus on business development to counteract a slowdown in the flow of job orders,” said Aaron McIntosh, Regional Vice President, APAC at Bullhorn. “Recruitment agencies that make the most of technologies such as AI and automation are, and will be, in a better position to lower margins, increase productivity, and differentiate their businesses from the competition. Forward-thinking agencies are looking at technology to help candidates find the best-fitting roles, help clients get workers on the job faster, and win more clients.”
Read the full report here.
About the GRID Industry Trends Report
The 14th annual GRID Industry Trends Report is based on a multiple-choice, online survey of more than 1,400 staffing and recruitment professionals working across a variety of industries and around the globe, including North America, the UK and Ireland, Benelux, DACH, and APAC. The survey was conducted in late 2023.
About Bullhorn
For the past 25 years, Bullhorn has dedicated itself to building industry-leading, cloud-based software for the staffing and recruitment industry. Through partnerships with 10,000 customers globally, Bullhorn has built a vast knowledge base of recruitment best practices and deep domain expertise to help firms scale their businesses. Founder-led and headquartered in Boston, Bullhorn employs 1,400 people across 14 countries focused on delivering an incredible customer experience – its core mission. To learn more, visit www.bullhorn.com or follow Bullhorn on Linkedin or X.
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