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© 2012 Crain Communications Inc
20 Underappreciated Business Opportunities
Jon OsborneVP Research/Editorial, Staffing Industry AnalystsMarch 15, [email protected]
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Boom in The Energy Sector
Oil & Gas Extraction Employment, 2007-2012,
+34%
Total Nonfarm Employment,2007-2012,
-3%Source: Bureau of Labor Statistics & Staffing Industry Analysts
© 2012 Crain Communications Inc
U.S. Natural Gas & Oil Output, 2007-2011
Source: U.S. Energy Information Administration & Staffing Industry Analysts
© 2012 Crain Communications Inc
Shortage of Petroleum Engineers
Source: Staffing Industry Analysts, Payscale.com, Bureau of Labor Statistics
© 2012 Crain Communications Inc
Energy Sector Buyers Like Contingents
• Most biased in favor
• Most ambitious in plans
• Most inclined to use more temps
Source: Staffing Industry Analysts 2011 Contingent Buyer Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
North Dakota The Next Texas?
Source: Staffing Industry Analysts & North Dakota Industrial Commission
Alaska = 550K
Texas = 1,200K
© 2012 Crain Communications Inc
More Job Openings Than Unemployed!
Source: Staffing Industry Analysts & North Dakota Workforce Intelligence Network
0
1
2
3
4
5
6
7
8
US North Dakota
Unemployed Per Job Opening, North Dakota and National
© 2012 Crain Communications Inc
Where the Shale Boom is Happening
Source: Staffing Industry Analysts & U.S. Energy Information Administration
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
The Return of U.S. Manufacturing
© 2012 Crain Communications Inc
Manufacturing—First Gains Since 1998
-2,000
-1,500
-1,000
-500
0
500
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Manufacturing Sector: 12-Month Rolling Change in Employment
Source: Bureau of Labor Statistics & Staffing Industry Analysts
© 2012 Crain Communications Inc
Manufacturing—What’s HotRank Description Jul Aug Sep Oct Nov Dec1 Fabricated structural metal products 6.4 7.0 7.1 6.8 7.0 6.7
2 Industrial molds 5.2 5.8 5.1 5.3 5.3 6.7
3 Alumina and aluminum production 6.6 6.6 6.9 5.0 6.0 6.5
4 Motor vehicle metal stamping 2.9 4.3 5.2 5.5 4.4 6.35 Primary metals 5.6 5.8 5.8 5.5 5.6 5.9
6 Other nonferrous metal production 5.9 6.0 5.6 5.5 5.1 5.9
7 Motor vehicle power train components 3.0 4.7 4.8 5.0 4.8 5.9
8 Ferrous metal foundries 5.3 5.1 5.6 5.8 5.6 5.8
9 Plate work and fabricated products 5.4 6.1 6.1 6.0 6.1 5.7
10 All other motor vehicle parts 3.1 4.6 4.6 5.0 4.9 5.7
11 Animal slaughtering 2.6 4.2 4.4 4.9 4.4 5.3
12 Metalworking machinery 4.7 5.5 5.8 5.4 6.2 5.313 Grain and oilseed milling 4.0 4.5 4.3 4.4 4.8 5.2
14 Fruit and vegetable canning and drying 4.9 4.6 5.1 6.1 5.9 5.215 Agricultural & construction machinery 5.5 6.0 7.4 5.8 5.6 5.2
Source: Bureau of Labor Statistics & Staffing Industry Analysts
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Interns = Temps
© 2012 Crain Communications Inc
About How Big is the Intern Market?
1.8MM College Grads
≈450K Summer Interns
≈$2.2 Billion in Payroll
Source: Staffing Industry Analysts
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Automated Staffing is BoomingHeroicZaarly.comCrowdsource.comWeGoLook.comjobboy.com
` Microtask.com Microtask.comThumbtack.com Thumbtack.comCloudcrowd.com Cloudcrowd.comMinuteworkers.com Minuteworkers.comDesigncrowd.com Designcrowd.comTaskrabbit.com Taskrabbit.com
crowdflower.com crowdflower.com crowdflower.comdomywork.net domywork.net domywork.netSmartsheet.com Smartsheet.com Smartsheet.com
Freelancer.com Freelancer.com Freelancer.com Freelancer.comoDesk.com oDesk.com oDesk.com oDesk.com oDesk.comDesigncontest.com Designcontest.com Designcontest.com Designcontest.com Designcontest.comShorttask.com Shorttask.com Shorttask.com Shorttask.com Shorttask.com
LiveOps LiveOps LiveOps LiveOps LiveOps LiveOpsifreelance.com ifreelance.com ifreelance.com ifreelance.com ifreelance.com ifreelance.comvWorker vWorker vWorker vWorker vWorker vWorkerscriptlance.com scriptlance.com scriptlance.com scriptlance.com scriptlance.com scriptlance.commyeasytask.com myeasytask.com myeasytask.com myeasytask.com myeasytask.com myeasytask.comFreelanced.com Freelanced.com Freelanced.com Freelanced.com Freelanced.com Freelanced.com
elance.com elance.com elance.com elance.com elance.com elance.com elance.comFreelance.com Freelance.com Freelance.com Freelance.com Freelance.com Freelance.com Freelance.comGuru.com Guru.com Guru.com Guru.com Guru.com Guru.com Guru.com
1999 2001 2003 2005 2007 2009 2011Source: Staffing Industry Analysts
© 2012 Crain Communications Inc
Automated Staffing is BoomingoDesk: Work Performed, Hours/Week
Source: oDesk.com
© 2012 Crain Communications Inc
Automated Staffing is Booming
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Temps
Non-Agency Contingent
Workers
Traditional Workers
The Really Big Recruiting Opportunity
This one!It’s hot!
© 2012 Crain Communications Inc
Which is Better: In-House Monopoly or Outsourced Competition?
In-HouseRecruiting YOU
© 2012 Crain Communications Inc
Recruiting Increasingly Outsourced
Source: Staffing Industry Analysts, Bureau of Labor Statistics, Contingent Buyer Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
What Wins in 2012? Recruiting!
Selling was a bigger challenge
Recruiting now a bigger challenge
Source: Staffing Industry Pulse Survey
© 2012 Crain Communications Inc
Who Knew Agencies Had Recruiters?
How would you find a recruiter specializing in your particular skills (finance, IT, etc.)?
Temps
Staffing agency
30%
Friend 25%
Web 44%
Freelancers
Web 56%
Friend 33%
Staffing agency
10%
Non-ContingentsStaffing agency
13%Friend 36%
Web 50%
Source: Staffing Industry Analysts 2009 Contingent Workers Survey
© 2012 Crain Communications Inc
Your Recruiters Are Not on the WebSearch Term# of first 20
Actual Recruiters
Staffing Agencies
Other
IT Recruiter 1 7 12
Engineering Recruiter 0 9 11
Nurse Recruiter 0 6 14
Accountant Recruiter 1 5 14
Recruiter 0 2 18
Source: Google & Staffing Industry Analysts
© 2012 Crain Communications Inc
Meet John Kaufman, an Actual Recruiter
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Become a Best Place to WorkStaffing firm priorities ranked by correlation with profit
2008 2010 2011
1 Recruting quality candidates to place
Training/developing nternal employees
Acquiring other firms
2 Training/developing internal employees
Creating a positive company culture
Recruiting/retaining quality internal staff
3 Recruiting/retaining quality internal staff
Recruiting/retaining quality internal staff
Training/developing nternal employees
4 Creating a positive company culture
Providing excellent customer service
Creating a positive company culture
5 Expanding number of clients Improving gross margins Reducing internal staff headcount
6 Providing excellent customer service
Recruting quality candidates to place
Improving gross margins
7 Acquiring other firms Expanding/diversifying number of clients
Providing excellent customer service
8 Growing revenue Growing market share Reducing/controlling costs
9 Improving cash flow/collections Growing revenue Expanding/diversifying number of clients
10 Improving gross margins Retaining existing clients Growing market shareSource: Staffing Industry Analysts’ Annual Staffing Firm Surveys
© 2012 Crain Communications Inc
Become a Best Place to Work
•1/220Odds of a
random staffing firm being among the
fastest-growing in U.S.:
•1/8Odds of “Best
Places to Work” staffing firm
being among the fastest-growing
in U.S.:
© 2012 Crain Communications Inc
Become a Best Place to Work
“Best Places to Work” survey opens in Fall, 2012
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Construction in Recovery
-1,400
-1,200
-1,000
-800
-600
-400
-200
0
200
2007
2008
2009
2010
2011
2012
Construction Sector: 12-Month Rolling Change in Employment
Source: Staffing Industry Analysts & Bureau of Labor Statistics
© 2012 Crain Communications Inc
Construction
Education
Arts &Rec
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%
Cycl
ical
ity
Seasonality
Seasonality and Cyclicality of Industries
Construction: Both Cyclical & Seasonal
Source: Staffing Industry Analysts & Bureau of Labor Statistics
© 2012 Crain Communications Inc
IC Crackdown to Hit Construction Hard
© 2012 Crain Communications Inc
Where Construction is Picking Up Now
Metro Area1 Lafayette, IN 145%2 Kennewick-Pasco-Richland, WA 80%3 Miami-Fort Lauderdale-Pompano Beach, FL 75%4 Myrtle Beach-North Myrtle Beach-Conway, SC 58%5 Tulsa, OK 45%6 San Diego-Carlsbad-San Marcos, CA 44%7 Washington-Arlington-Alexandria, DC-VA-MD-WV 42%8 Durham-Chapel Hill, NC 39%9 Birmingham-Hoover, AL 38%
10 Denver-Aurora-Broomfield, CO 37%11 Raleigh-Cary, NC 37%12 Lake Charles, LA 36%13 Dallas-Fort Worth-Arlington, TX 35%14 Cape Coral-Fort Myers, FL 34%15 Ogden-Clearfield, UT 34%
Last 12 months percent change in new residential building permits
Source: U.S. Census Building Permits Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
2%
3%
5%
11%
21%
24%
34%
Channel partnership sales
Spend time answeringRFPs/RFIs/RFQs
Hiring national/regional sales staff
Focus on recurring business
Hiring local sales staff
Telephone/door-to-door cold calling
Existing accountpenetration/development
Which sales tactic would you say has the highest bang-to-buck return on spend/effort?
Cold Calls Still Work
Source: 2010 Staffing Company Survey
© 2012 Crain Communications Inc
Cold Calls Still Work
Buyers: How have you typically heard about the staffing suppliers that you ultimately used?
45% of buyers found agency because “a salesperson called”!
Source: 2010 Contingent Buyer Survey
© 2012 Crain Communications Inc
Some Cold Calling Tips1) Don’t do cold calls—do warm calls, i.e., use marketing in advance of calls to create an impression
2) Ask yourself—are you calling the right person?
3) Get your elevator speech right—you have about 15 seconds to say something smart4) Be opportunistic—use logical opportunities when they surface
5) Discipline—eventually the laws of numbers will work
6) Drop a name of someone they know—use Linkedin, social networking to find relationships
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Get on Lists
Source: 2010 Contingent Buyer Survey
© 2012 Crain Communications Inc
Get on These Lists
Regions U.S. Temp Segments U.S. Other Staffing U.S. Opportunity ListsGlobal Largest Office/clerical Direct Hire Fastest-GrowingU.S. Largest Industrial Retained Search DiversityCanada Largest Information technology PEO MentorsGlobal IT Services Engineering PEO Revenue Detail ProtégésGlobal Engineering Services Finance Outplacement Acquirers
LegalMarketing/creativeClinical/scientificHealthcare Allied Healthcare Locum Tenens Per Diem Nursing Travel Nursing
© 2012 Crain Communications Inc
Step 1) Find Dan, Step 2) Give Him Biz Card
Dan Begley-GrothResearch Analyst
Give him your business card and he will get you on our lists.
Or email [email protected]
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Local Government Outsourcing
19,100
19,200
19,300
19,400
19,500
19,600
19,700
Jan/2010 Jan/2011 Jan/2012
U.S. State & Local Employment
Source: BLS & Staffing Industry Analysts
© 2012 Crain Communications Inc
Local Government Outsourcing
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Don’t Be Small
0
1
2
3
4
5
6
7
8
<2.5
2.5-
4.9
5-9.
9
10-2
4.9
25-4
9.9
50-9
9.9
100-
249.
9
250+
Annual revenue ( $Millions)
2011: Average Number of Years Continuous Profitability, as a Function of Firm Size
Source: 2011 Staffing Company Survey
© 2012 Crain Communications Inc
Don’t Be Small
0
1
2
3
4
5
6
<$2.
5
$2.5
-$4.
9
$5-$
9.9
$10-
$24.
9
$25-
$49.
9
$50-
$99.
9
$100
-$24
9.9
$250
-$49
9.9
$500
-$99
9.9
$1 b
illio
n+
Annual revenue ( $Millions)
2010: Average Number of Years Continuous Profitability, as a Function of Firm Size
Source: 2010 Staffing Company Survey
© 2012 Crain Communications Inc
Don’t Be Small
Segment offered <10 10-99.9 100+IT $3,300,000 $9,226,190 $16,666,667Healthcare $2,000,000 $15,000,000 $8,250,000Office/Clerical $1,750,000Industrial $2,550,000 $3,660,714 $3,448,617
All firms $2,333,333 $4,420,000 $9,065,217*Insufficient sample size to provide both ranges; combined into one
Median revenue per branch office by primary segment offered/primary industy served and company size
$5,000,000*
Source: 2011 Staffing Company Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Take the internet seriously
9%
4%
6%
6%
10%
12%
16%
18%
18%
Other
Search engine ads
E-mail newsletters
Direct mailings
Search engine optimization
Social media
E-mail blast
Attend/sponsor conferences
Company web site
Which marketing tactic would you say has the highest bang-to-buck return on spend/effort?
Source: 2010 Staffing Company Survey
© 2012 Crain Communications Inc
Take the internet seriously
9%
4%
6%
6%
10%
12%
16%
18%
18%
Other
Search engine ads
E-mail newsletters
Direct mailings
Search engine optimization
Social media
E-mail blast
Attend/sponsor conferences
Company web site
Which marketing tactic would you say has the highest bang-to-buck return on spend/effort?
Source: 2010 Staffing Company Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Keep a Seasonal Employment Calendar
Of contingent labor is hired for seasonal needs
Source: 2008 Contingent Buyer Survey
© 2012 Crain Communications Inc
Keep a Seasonal Employment Calendar
Monthly Change in Employment, 2000-2010
-8
-6
-4
-2
0
2
4
6
Up Spikes = Hiring in Apr, May, Jun, Jul
Thou
sand
s of J
obs
Example: Scenic & Sightseeing Transportation
Source: Staffing Industry Analysts & Bureau of Labor Statistics
© 2012 Crain Communications Inc
Seasonal Calendar for Your Sales DeptJan Feb Mar Apr May Jun
Accounting/Bookkeeping
Accounting/Bookkeeping
Building material and garden supply stores
Scenic and sightseeing transportation
Scenic and sightseeing transportation
Scenic and sightseeing transportation
State government education
Performing arts and spectator sports
Amusements, gambling, and recreation
Educational services
Services to buildings and dwellings
Heavy and civil engineering construction
Source: Staffing Industry Analysts & Bureau of Labor Statistics
© 2012 Crain Communications Inc
Keep a Seasonal Employment CalendarJul Aug Sep Oct Nov Dec
Scenic and sightseeing transportation
Motor vehicles and parts
Transit and ground transportation
Educational services
Department stores
Accounting and bookkeeping
Amusements, gambling, and recreation
State/Local government education
General merchandise stores
Couriers and messengers
Arts, entertainment, and recreation
Educational services
Clothing and clothing accessories stores
Child day care services
Source: Staffing Industry Analysts & Bureau of Labor Statistics
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
IC Screening/Compliance
Odds that a buyer is employing improperly classified independent contractors:
87%
Odds that a buyer will be involuntarily audited by an external entity this year:
49%
Odds that a buyer will be in hot water shortly:
43%Source: 2010 Contingent Buyer Survey
© 2012 Crain Communications Inc
IC Screening/Compliance
37%41%
49%
62%
2009 2010 2011 2013
Buyers: Do you use a vendor for IC screening/compliance?
Source: 2009-2011 Contingent Buyer Surveys
© 2012 Crain Communications Inc
IC Screening/Compliance
Source: 2010 Contingent Buyer Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Think Globally, Act Profitably
16%
21%24% 25%
2008 2009 2010 2011
Buyers: Do you manage your contingent workforce on a
global basis?
Source: 2009-2011 Contingent Buyer Surveys
© 2012 Crain Communications Inc
Think Globally, Act Profitably
Source: 2010 Staffing Company Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Resume Hot List
1.4%
1.3%
1.3%
1.3%
1.1%
1.0%
1.0%
1.0%
1.0%
1.0%
0.8%
0.7%
0.7%
0.6%
0.5%
FirefightersArchitectural and engineering managers
Environmental scientists and geoscientistsPsychologistsVeterinarians
Speech-language pathologistsLocomotive engineers and operators
ClergyDetectives and criminal investigators
Physical therapistsOccupational therapists
Training and development managersDentists
Physicians and surgeonsComputer network architects
Occupations With Less Than 1.5% Unemployment
Source: Staffing Industry Analysts and Bureau of Labor Statistics
© 2012 Crain Communications Inc
Resume Hot List
2.2%
2.2%
2.2%
2.2%
2.0%
2.0%
2.0%
2.0%
1.9%
1.9%
1.9%
1.8%
1.8%
1.7%
1.5%
Computer hardware engineersLawyers
Insurance underwritersLibrarians
Farmers, ranchersPower plant operatorsBiological technicians
Police and sheriff’s patrol officers Database administrators
Registered nursesPrepress technicians and workers
Animal trainersTherapists, all other
Geological and petroleum techniciansSupervisors of police and detectives
Occupations With Less Than 2.3% Unemployment
Source: Staffing Industry Analysts and Bureau of Labor Statistics
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Retailers: 0.4% to 5.0% of sales
Automakers: 2.5% to 3.5% of sales
Packaged goods: 4% to 10% of sales
Staffing firms: 0.4% of sales (median)
You Don’t Take Marketing Seriously
Source: Staffing Industry Benchmarking Consortium, Google
© 2012 Crain Communications Inc
Marketing Exec is Last Hired
VP, Sales
CFO
VP, Marketing
0%
10%
20%
30%
40%
50%
60%
0 1 2 3 4 5 6 7 8 9 10
Perc
ent o
f firm
s
Company age
Percent of firms with selected executives, by company age
Source: 2011 Staffing Company Survey
© 2012 Crain Communications Inc
Marketing Exec is Lowest Paid
25th Median 75th Average N
Founder/CEO/Chairman $110,000 $177,500 $287,500 $224,332 131
President/COO $117,500 $157,500 $262,500 $236,234 78VP/SVP/EVP, Sales $122,500 $162,500 $212,500 $192,336 60
CFO/VP, Finance $145,000 $185,000 $263,000 $222,188 24Region/Division Head $97,500 $162,500 $225,000 $160,326 23VP/SVP/EVP, Marketing $102,500 $127,500 $205,000 $151,591 11
Compensation across occupations
Source: 2011 Staffing Company Survey
© 2012 Crain Communications Inc
© 2012 Crain Communications Inc
Don’t Be Shy!
© 2012 Crain Communications Inc
Dan Begley-GrothResearch Analyst
Jon OsborneVP, Research
Robert BalickiResearch Analyst
Andrew KarpieResearch Analyst
Timothy LandhuisResearch Associate
Sona SharmaSeniorResearch Analyst
CraigJohnsonManagingEditor
SubadhraSriramEditorialDirector
TonyGregoireSeniorResearch Analyst
© 2012 Crain Communications Inc
Questions