Annual Report 2011

The HR industry
Overview

Our industry increases the efficiency of labour markets, raises the competitiveness of companies and creates jobs that would not otherwise exist.

Lifelong employment for everyone, adapted to personal, family, generational and geographical needs and abilities is the aim of our industry. HR services companies help people find a permanent, fixed-term or temporary job as well as enhancing their employability through career counselling, education and continuous training.

In 2011, the global staffing market grew approximately 7% [1] to EUR 265 billion [1]. This compares with an estimated increase of 11% to EUR 248 billion in 2010 [1]. Professional Staffing accounted for around 30% [1] of the market in 2011 and increased 5% [1] year-on-year, while General Staffing was up 8% [1] compared to 2010 and represented 70% [1] of the global market in 2011.

The USA represented the single largest market for HR services measured by revenues in 2011, with a share of approximately 31% [1], followed by Japan with 17% [1] and the UK with 8% [1]. Europe as a whole represented 36% [1] of the global staffing market in 2011, whereas the Emerging Markets accounted for 11% [1]. The major markets developed diversely in 2011 and varied between a revenue decline of 6% [1] and growth of 22% [1]. The market in Japan continued to decline, while growth in the UK was still subdued. A more restrictive legislative proposal in Japan held back demand for temporary staffing services. In the UK, a sluggish economy, characterised by being largely service-driven, and cuts in government spending led to a substantial decline in demand for temporary staffing services.

Competitive landscape  The global HR services market is highly fragmented and the competitive landscape varies considerably from one country to another. There were 125,000 registered private employment agencies worldwide in 2010 according to Ciett [2]. The three biggest markets measured by revenues – the USA, Japan and the UK – show a very high degree of fragmentation, with Japan showing the largest number of staffing companies, followed by the USA and UK. The French market, by contrast, is highly concentrated. The top three listed staffing companies dominate the French market with a combined market share of around 70% [1], measured by revenues. Looking at the global picture, the three largest listed staffing companies represent 20% [1] of global turnover. The Adecco Group is the largest HR services company worldwide and has leading positions in Europe, North America, Asia/Pacific and Latin America. Consolidation in the staffing industry is on-going, particularly in fragmented markets. The trend of large multinational companies to outsource part or all of their HR processes continued and led to further consolidation in the industry. Partnering with a Managed Services Provider (MSP), to manage the company’s contingent workforce spend, typically results in higher volumes for fewer suppliers. Moreover, consolidation is also driven by General Staffing companies seeking a stronger foothold in the Professional Staffing markets in order to diversify their product offerings and to enhance their position in this more profitable and faster-growing segment.

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Adecco’s market position in 2011

 

% of Adecco
revenues

Market
share [1]
in %

Market
position [1]

 

 

 

 

France

30

31

1

North America

18

4

2

UK & Ireland

8

8

1

Japan

7

3

4

Germany & Austria

7

9

2

Benelux

5

5

3

Italy

5

18

1

Nordics

4

13

2

Iberia

4

25

2

Australia & New Zealand

2

4

4

Switzerland

2

16

1

Emerging Markets

7

5

1

LHH

1

18

1

 

[1]Adecco estimate. 2010 estimates revised.

[2]Ciett = International Confederation of Private Employment Agencies